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Using only the information in the accompanying table, answer the questions that follow.

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a. Determine the present value' of the mixed stream of cash flows using a 5% discount rates.

b. How much would you be willing to pay for an opportunity to buy this stream, assuming that you can at best earn 5% on your investments?

c. What effect, if any, would a 7% rather than a 5% opportunity cost have on your analysis? (Explainverbally.)

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