An entrepreneur has to decide between two possible


An entrepreneur has to decide between two possible investment projects. Both projects cost $80.000 upfront. The short term project pays $35.000 for the next three years. The long term project pays $120.000 after four years. Alternatively the entrepreneur can put the money in a bank account that pays 8% per year. What is the preferred project? Does your answer change if the bank account interest rate is 15%? Briefly explain your results.

Request for Solution File

Ask an Expert for Answer!!
Financial Econometrics: An entrepreneur has to decide between two possible
Reference No:- TGS0666048

Expected delivery within 24 Hours