2. An investor is deciding how much to invest and whether to apply that income to...

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2. An investor is deciding how much to invest and whether to apply that income to capital or to put that money in a savings account, which obtains the return r. Argue that the net present value of investing I today is given by NPV=-I+ TI 1+r 3. Argue that r=1+r. Use that relationship to how that aA K2 2. An investor is deciding how much to invest and whether to apply that income to capital or to put that money in a savings account, which obtains the return r. Argue that the net present value of investing I today is given by NPV=-I+ TI 1+r 3. Argue that r=1+r. Use that relationship to how that aA K2