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The Claussens are considering the purchase of a hardware store. The Claussens anticipate that the store will generate cash flows of $90,000 per year for 20 years. At the end of 20 years, they intend to sell the store for an estimated $600,000. The Claussens will finance the investment with a variable rate mortgage. Interest rates will increase twice during the 20-year life of the mortgage. Accordingly, the Claussens desired rate of return on this investment varies as follows:

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