An Investment of $1

question 25

Multiple Choice

An investment of $1.5 million is expected to generate cash flows of $600 000 p.a. ,at constant prices,over the next three years.Given that the nominal required rate of return is 12% p.a.and that prices are expected to increase at the rate of 5% p.a. ,the project's net present value is:

• A)($58 901)
• B)$84 229
• C)(187 031)
• D)$13 154

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Definitions:

Institutionalized

The process of establishing something as a norm or standard in an organization or culture, or becoming adapted to life in an institution.

1960s

A decade from 1960 to 1969 characterized by significant cultural, social, and political changes worldwide.

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A racial or ethnic group in the United States with ancestry primarily from sub-Saharan Africa.

Civil Commitment

A legal process through which individuals with severe mental illnesses can be court-ordered to receive treatment, usually when they're considered a danger to themselves or others.