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Business, 22.04.2020 04:21 xaguilar

You have just purchased a new VCR to show videos to your customers. The VCR cost $500 in real dollars, and you depreciate the machine at a rate of 25% each year. You can borrow money from the bank at a nominal interest rate of 10%, or receive a 6% nominal interest rate for depositing money at the bank. The expected inflation rate in the coming year is 5%.You used the company's own funds to purchase the VCR. The firm's user cost of capital for the rest year is

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You have just purchased a new VCR to show videos to your customers. The VCR cost $500 in real dollar...
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