Question
A friend asks to borrow from you $55 and in return will pay you $58 in one year. If your bank is offering a 5.9%
A friend asks to borrow from you $55 and in return will pay you $58 in one year. If your bank is offering a 5.9% interest rate on deposits and loans:
a. How much would you have in one year if you deposited the $55 instead?
b. How much money could you borrow today if you pay the bank $58 in one year?
c. Should you loan the money to your friend or deposit it in the bank?
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Foundations of Financial Management
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen
15th edition
77861612, 1259194078, 978-0077861612, 978-1259194078
