A company wants to purchase a plant for its expanding operations. The desired plant is available at `3,00,000 in cash or `4,50,000 to be paid in 5 equal annual instalments due at the end of each year....

A company wants to purchase a plant for its expanding operations. The desired plant is available at `3,00,000 in cash or `4,50,000 to be paid in 5 equal annual instalments due at the end of each year. Assuming the required rate of return of 15 per cent, which option should the company exercise? Ignore taxes.