An investor invests £10,000,000 in a new factory, which takes a year to build. After construction is finished, the factory will generate an income of £110,000 monthly, received in arrears, for 10 years. Compute the yield of the investment project. Enter a percentage correct to 1 decimal place

An investor invests £10,000,000 in a new factory, which takes a year to build. After construction is finished, the factory will generate an income of £110,000 monthly, received in arrears, for 10 years. Compute the yield of the investment project. Enter a percentage correct to 1 decimal place

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Question

An investor invests £10,000,000 in a new factory, which takes a year to build.

After construction is finished, the factory will generate an income of £110,000 monthly, received in arrears, for 10 years.

Compute the yield of the investment project.

Enter a percentage correct to 1 decimal place

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