Consider the following investment cash flowsyearcash, Ask an Expert

Finance

Consider the following investment cash flows:

Year	Cash Flow
0	($1000)
1	250
2	400
3	500
4	600
5	600

a. What is the return expected on this investmentmeasured in dollar terms if the opportunity cost rate is 10 percent?

b. Provide an explanation, in economics terms, of your answer.

c. What is the return on this investment measured in percentage terms?

d. Should this investment be made? Explain your answer.

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Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M9792181

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