Question: Why is it fairly easy to fall into the trap of discounting real cash flows with nominal rates? 1) increases in nominal cash flows are

Why is it fairly easy to fall into the trap of discounting real cash flows with nominal rates? 1) increases in nominal cash flows are often not forecast. 2) increases in revenues are offset by increases in costs. 3) it is difficult to determine real discount rates. 4) inflation does not impact cash flows, but it does impact discount rates.

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