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  3. 1. a company has the option of building a warehous

1. A company has the option of building a warehouse now or building it three...

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Accounting

1. A company has the option of building a warehouse now or building it three years from now. The cost now would be $400,000, but three years from now the cost will be $500,000. If the company's minimum attractive rate of return (real i) is 10% per year and the inflation rate is 5% per year, the present worth cost of the building in three years when inflation is considered is:

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