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Calculate the npv and rate of return

Problem:

Calculate the NPV and rate of return for each of the following investments. The opportunity cost of capital is 20 percent for all four investments.

Investment C0 C1

1    -10000    18000
2    -5000    9000
3    -5000    5700
4    -2000    4000

a) Which investment is most valuable

b) Suppose each investment would require use of the same parcel of land. Therefore you can take only one. Which one? Hint: What is the firm's objective: to earn a high rate of return or to increase firm value?

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