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A Farmer Sows a Certain Crop

Question 89

Multiple Choice

A farmer sows a certain crop.It costs $250,000 to buy the seed,prepare the ground,and sow the crop.In one year's time it will cost $110,000 to harvest the crop.If the crop will be worth $380,000,and the interest rate is 8%,what is the net present value (NPV) of this investment?


A) -$21,000
B) -$220
C) $0
D) $23,100
E) $20,000

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