# Considering investment alternatives

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Consider two investment alternatives with the following projected cash flows.

-Investment #1 (Year 1 is $10,000, Year 2 is $10,000, Year 3 is $10,000).

-Investment #2 (Year 1 is $0, Year 2 is $10,000, Year 3 is $25,000).

Can we assume that Investment 2 is preferable because its total cash flow over the three-year period is higher? What additional information is needed to make an informed choice between these investments?

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##### Solution Summary

The expert determines which investment is preferable. The informed choice between the investments are given.

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Hi there,

A few things to consider:

1) What is the market interest rate over the course of these three years? If interest rates are really high, then it would ...

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