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A) Suppose that we invest $10, and receive $5, $p,$7, and $3 in years 1, 2, 3, and 4, where p is unknown. Suppose that
A)
Suppose that we invest $10, and receive $5, $p,$7, and $3 in years 1, 2, 3, and 4, where p is unknown. Suppose that the present value of this investment, at interest rate 10%, is $4.63. What is p (round to cents)?
B)
Consider a transaction stream consisting of
$5 every quarter for 10 years.
$1000 in 10 years
Assume an annual interest rate of 2%. What is the present value of this cash stream (interest compounded quarterly)?
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