Question
Amanda and Bethany share equally in the present value of an annuity due which has two annual payments. If Amanda gets the entire 2nd payment,
Amanda and Bethany share equally in the present value of an annuity due which has two annual payments. If Amanda gets the entire 2nd payment, what portion of the 1st payment should Bethany receive? Assume that the effective annual discount rate is 10%.
A. 80% of the first payment
B. 85% of the first payment
C. 90% of the first payment
D. 95% of the first payment
E. The entire first payment
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Investments
Authors: William F. Sharpe, Gordon J. Alexander, Jeffery V. Bailey
6th Edition
8120321014, 978-8120321014
