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Suppose That a Property Can Generate Cash Flows of $10,000

Question 28

Multiple Choice
Suppose that a property can generate cash flows of $10,000 per year for eight years and can sell for $80,000 at the end of the investment period. Assuming a discount rate of 10%, what is the present value of this property (Assume end of period cash flows in your calculation)?
A) $117,320
B) $160,000
C) $133,349
D) $90,670

Suppose that a property can generate cash flows of $10,000 per year for eight years and can sell for $80,000 at the end of the investment period. Assuming a discount rate of 10%, what is the present value of this property (Assume end of period cash flows in your calculation) ?


A) $117,320
B) $160,000
C) $133,349
D) $90,670

Correct Answer:

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