An Investment Costs $725 and Is Expected to Produce Cash

question 26

Multiple Choice

An investment costs $725 and is expected to produce cash flows of $75 at the end of Year 1,$100 at the end of Year 2,$85 at the end of Year 3,and $625 at the end of Year 4.What rate of return would you earn if you bought this investment?

• A)5.19%
• B)5.46%
• C)5.75%
• D)6.05%

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