Marian Plunket owns her own business and is considering an investment. If she undertakes the​ investment, it will pay $4,880 at the end of each of the next 3 years. The opportunity requires an initial investment of $1,220 plus an additional investment at the end of the second year of $6,100. What is the NPV of this opportunity if the interest rate is 1.8% per​ year? Should Marian take​ it? (yes or no)

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter5: The Time Value Of Money
Section: Chapter Questions
Problem 19P
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Marian Plunket owns her own business and is considering an investment. If she undertakes the​ investment, it will pay $4,880 at the end of each of the next 3 years. The opportunity requires an initial investment of $1,220 plus an additional investment at the end of the second year of $6,100. What is the NPV of this opportunity if the interest rate is 1.8% per​ year?

Should Marian take​ it? (yes or no)

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