I Am Considering a Project Which Requires an Immediate Investment

question 52

Multiple Choice

I am considering a project which requires an immediate investment of $10 000 and yields a return in two years. If I expect the rate of inflation to be 15%, how big, in actual dollars, must the return be if my real rate of return on the project is to be 20%?

• A)$13 500
• B)$13 800
• C)$14 400
• D)$18 225
• E)$19 044

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Definitions:

Real Estate Partnership

A type of business arrangement in which partners join together to buy, sell, manage, or invest in real estate properties.

RUPA

The Revised Uniform Partnership Act, which governs the operation of partnerships in the jurisdictions that have adopted it.

Disproportionate

Lacking symmetry, balance, or proportion; notably unequal or uneven in distribution or adjustment.

Partnership Agreement

A legal document that outlines the rights, responsibilities, and obligations of each partner in a business partnership.