Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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The business plan for KnowIt, LLC, a start-up company that manufactures portable multigas detectors, showed equivalent annual cash flows of $400,000 for the first 5 years. If the cash flow in year 1 was $306,000 and the constant increase thereafter was $50,000 per year, what interest rate was used in the calculation?
The interest rate used in the calculation was
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