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Business, 26.06.2020 16:01 ExclusiveNay

Two mutually exclusive investment opportunities require an initial investment of $10 million. Investment A pays $1.5 million per year in perpetuity, while investment B pays $1.2 million in the first year, with cash flows increasing by 3% per year after that. At what cost of capital would an investor regard both opportunities as being equivalent?

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Two mutually exclusive investment opportunities require an initial investment of $10 million. Invest...
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