Question
1.) growing payments - Two investments with similar risk levels are both priced at $70. One pays a constant $2 per year forever, the other
1.) growing payments - Two investments with similar risk levels are both priced at $70. One pays a constant $2 per year forever, the other pays $1 the first year with payments growing at 3% per year forever after. Which is more attractive?
2.) Compounding frequency Which is better: an investment paying 12% compounded quarterly or one paying 12.1% compounded annually?
3.) I can pay a $50 fee today and get an instant tax refund instead of waiting 3 weeks for my $950 refund in the mail. What is the interest rate on the implicit loan expressed as
A weekly rate?
An APR?
An EAR?
show all FORMULAS and work
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