A project is expected to produce a cash flow of $20,000 next year. The cash flow is expected to grow at a rate of 8% indefinitely. If the opportunity cost of capital is a constant 12%, what is
The maximum amount you should be willing to invest in the project?
A) $560,000
B) $540,000
C) $500,000
D) none of the above
Correct Answer:
Verified
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