Question
An investor has placed a certain amount in a bank deposit at an annual interest rate of 25% in a compound interest regime over a
An investor has placed a certain amount in a bank deposit at an annual interest rate of 25% in a compound interest regime over a period of 5 years.
a). if there isnt foreseen any depreciation find the growth index of the initial amount;
b). after 5 years the investor realizes that the deposit values 32 times less than the initial amount placed. What was the annual average depreciation percent over the period?
c). if this depreciation would have been foreseen determine the nominal interest rate at which the initial amount should have been placed so that the real interest remained 25%?
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