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Consider an entrepreneur with initial resources valued at $x.

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Question

Consider an entrepreneur with initial resources valued at $x. The entrepreneur has to make an investment decision that has a return described in the following transformation curve;K?2 + K?2 = 144;(a) What is x?;(b) If K1 = 9, what is the level of investment? What is the cash flow in each period?;(c) If K1 = 9, what is the marginal return?;(d) If r=10%, should the entrepreneur invest more or less than $3?

 

Paper#28692 | Written in 18-Jul-2015

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