Chapter4: Time Value Of Money
Section: Chapter Questions
Problem 15PROB
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![4- Let's assume we have two projects like R&D and construction.
Both require an initial amount of 1500 TL. The R&D program
produces a return of 1200 TL at the end of the first year and 850 TL
at the end of the third year. The construction has a single significant
pay-off of 2100 in three years. Now, which project should you
choose when discount rates is zero, 5% and 7%?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F1b6db560-cec8-403c-b675-a8b4801c0066%2F1dc21d16-7e80-455f-b2a1-1387b2370610%2Flr0rj8v_processed.jpeg&w=3840&q=75)
Transcribed Image Text:4- Let's assume we have two projects like R&D and construction.
Both require an initial amount of 1500 TL. The R&D program
produces a return of 1200 TL at the end of the first year and 850 TL
at the end of the third year. The construction has a single significant
pay-off of 2100 in three years. Now, which project should you
choose when discount rates is zero, 5% and 7%?
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