Business, 25.11.2021 07:40 samueltaye

Fred's fish house is contemplating an investment of 2000000 in new shrimp boats and deep fryer. Management of this company predict a 7.8 percent annual return on this investment. The current market rate of interest is 3.7 percent. Fred's fish house will: a. make the investment since the cost is greater than the expected return.

b. Not make the investment since the cost is greater than the expected return

c. not make the investment since the cot is less than the expected return.

d. make the investment since the cost is less than the expected return.

At which of the market rates of interest below would Fred's Fish House be inclined to make the investment?

a. 3.5%

b. 3%

c. 2%

d. at any of these interest rates listed

Answers: 3

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Fred's fish house is contemplating an investment of 2000000 in new shrimp boats and deep fryer. Mana...