Question: If you require a 25% return, what is maximum you should pay for the following investment? You buy a vending machine that will pay you

If you require a 25% return, what is maximum you should pay for the following investment?

You buy a vending machine that will pay you the following cash flows:

Year 1:$500

Year 2:$1,000

Year 3:$1,500

Year 4:$2,000

Year 5:$2,500

At the end of Year 5 you sell the machine for $2,500.

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