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(Ignore Income Taxes in This Problem

Question 44

Multiple Choice

(Ignore income taxes in this problem.) An investment of P pounds now will yield cash inflows of £3,000 at the end of the first year and £2,000 at the end of the fourth year. If the internal rate of return for this investment is 20%, then the value of P is


A) £3,463.
B) £2,499.
C) £964.
D) £4,185.

Correct Answer:

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