Question
Calculate the first-order modified approximation and first-order Macaulay approxima- tion of P(3.9%) centered at i0 = 3.8%, for the set of cashflows C1 = $50,
Calculate the first-order modified approximation and first-order Macaulay approxima- tion of P(3.9%) centered at i0 = 3.8%, for the set of cashflows C1 = $50, 000, C2 = $80, 000, and C5 = $25, 000. Which approximation is more accurate? Why doesnt this contradict our theorem that the other one is more accurate?
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Government and Not for Profit Accounting Concepts and Practices
Authors: Michael Granof, Saleha Khumawala, Thad Calabrese, Daniel Smith
7th edition
1118983270, 978-1119175025, 111917502X, 978-1119175001, 978-1118983270
