HVAC · Practice-Exam-2 · Problem 4
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HVAC · Practice-Exam-2 · Problem 4
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Problem: A company pays 500k for a warehouse that it plants the whole for 15 years.
Key step: At the end of 15 years, what sale price is needed to realize an 8% rate of return?
Watch out: We don't know what that's going to be.
Result: And if 8% is going to be the rate of return, if that's going to be the interest rate, then the present value will equal zero.
✅ Answer: B
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