Question
1. An investment will pay out $1,000 today and every two years thereafter for the next twenty years (11 cash flow payments). Assuming that the
1. An investment will pay out $1,000 today and every two years thereafter for the next twenty years (11 cash flow payments). Assuming that the annual rate is 5%, would you take this investment if it costs $7,100?
2. What is the present value of the investment if it pays every three years (instead of two years) (11-cash flow payments)?
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