General Motors is thinking about building a new factory. The factory cost (today) is $280...
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General Motors is thinking about building a new factory. The factory cost (today) is $280 millions and the perspective yield is $312 millions in 3 years. Can you explain whether GM will undertake the project if the interest rate is 5%? Would you give the same answer if the interest rate were 2%? To answer this question, use the three notions of present value, future value and IRR.
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