Solved: Purchasing an investment, Julie can purchase an investment now or she can wait one year, Finance Basics

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Purchasing an investment

Problem:

Julie can purchase an investment now or she can wait one year from now to invest. The cash flows for investing now or postponing one year are:

TIME 0 1 2 3 4 5 6
Invest now -150 15 20 25 30 35 40
Invest in one year -75 25 25 25 25 25

If the cost of capital is 11%, should Julie invest now or postpone and invest in one year?

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