You have the option to either invest now or invest in two


You have the option to either invest now or invest in two years in a project with the following cash flows

     Time           0                      1                      2                      3                      4                      5                      6

      Now        -25                     4                      6                      10                    5                      8                      9

      In two years                                              -30                   10                    10                    10                    10

If the cost of capital is 8 percent

Invest now because NPV is higher

Invest in 2 years

Neither

Invest now because NPV of waiting is negative

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Financial Management: You have the option to either invest now or invest in two
Reference No:- TGS02711917

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