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56 (2 points) Listen Use the table for the question(s) below. Suppose the term structure of interest rates is shown below: 10 20 Term 1
56 (2 points) Listen Use the table for the question(s) below. Suppose the term structure of interest rates is shown below: 10 20 Term 1 year 2 years 3 years 5 years years years Rate (EAR%) 5.00% 4.80% 4.60% 4.50% 4.25% 4.15% What is the net present value (NPV) of an investment that costs $2,500 and pays $1,000 at the end of one, three, and five years? Z
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