Margaret has a project with a $28000 first cost that returns $5000 per year over its 10-year life. It has a salvage value of $3000 at the end of 10 years. If the MARRIS 15 percent, whatis the present worth of this project?

Margaret has a project with a $28000 first cost that returns $5000 per year over its 10-year life. It has a salvage value of $3000 at the end of 10 years. If the MARRIS 15 percent, whatis the present worth of this project?

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter9: Capital Budgeting Techniques

Section: Chapter Questions

Problem 11PROB

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Concept explainers

Real Estate

Real estate means ownership of land along with the assets and natural resources that exist on the land. These properties are in real/physical form which is tangible. Real estate simply means land or addition made to land permanently like constructing a residence or different buildings. People invest in real estate to either reside or for wealth creation. Many people investing in real estate further lend the place for occupation or businesses in return for a monthly payment.

Question

7. Margaret has a project with a $28 000 first cost that returns $5000 per year over its 10-year life. It has
a salvage value of $3000 at the end of 10 years. If the MARRIS 15 percent, whatis the present worth
of this project?

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