You have a project costing $1.50 that will produce two widgets, one each the first and second

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You have a project costing $1.50 that will produce two widgets, one each the first and second years after project completion. Widgets today cost $0.80 each, with the price growing at 2% per year. The effective annual interest rate is 5%. What is the value today of the project and when will you invest?

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Derivatives Markets

ISBN: 9789332536746

3rd Edition

Authors: Robert McDonald

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