Question: Marin Inc. is using a discounted cash flow model. Scenario 1: Cash flows are fairly certain $110/year for 5 years Risk-adjusted discount rate is

Marin Inc. is using a discounted cash flow model. Scenario 1: Cash

Marin Inc. is using a discounted cash flow model. Scenario 1: Cash flows are fairly certain $110/year for 5 years Risk-adjusted discount rate is 7% Risk-free discount rate is 4% Scenario 2: Cash flows are uncertain 75% probability that cash flows will be $110 in 5 years 25% probability that cash flows will be $110 in 5 years Risk-adjusted discount rate is 7% Risk-free discount rate is 4%

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