Part A) From the sale of your family property, you will receive a down payment...
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Part A) From the sale of your family property, you will receive a down payment of $15,000 today and then yearly payments of $15,000 for the next 14 years. If the discount rate is 7% compute the present value of your future payments. ) Part B) Instead of receiving annual payments, you could receive one $135,000 lump sum payment today. Should you take the lump sum instead? 9, S Perpetuity 10. You plan to purchase a small service company. You anticipate receiving annual cash flows of $50,000 per year forever. (A) If you require an 10 % return on your investment, what is the mos you should pay for this company? (B) What is the NPV if you can purchase it for $500,000
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