You are offered a deal that would pay you the following


Question: You are offered a deal that would pay you the following cash flows. If you require a 12% rate of return, what is the most you should pay for the deal? Assume that all cash flows occur at the end of the year (with the exception of year "0", which of course occurs immediately).

Year Cash Flow

0 $0

1 1000

2 1000

3 2000

4 2000

5 1000

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Finance Basics: You are offered a deal that would pay you the following
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