A venture will provide a net cash inflow of $57,000 in Year 1. The annual...
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A venture will provide a net cash inflow of $57,000 in Year 1. The annual cash flows are projected to grow at a rate of 7 percent per year forever. The project requires an initial investment of $739,000 and has a required return of 15.6 percent. The company is somewhat unsure about the growth rate assumption. At what constant rate of growth would the company just break even?
| A. | 7.75 percent | |
| B. | 7.89 percent | |
| C. | 9.48 percent | |
| D. | 9.29 percent | |
| E. | 8.49 percent |
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