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Compute the requested value(s) for each scenario. You have discovered the local bank is offering loans at 22.00% compounded annually or 20.00% compounded monthly.
Compute the requested value(s) for each scenario. You have discovered the local bank is offering loans at 22.00% compounded annually or 20.00% compounded monthly. Which loan alternative is the most attractive, ceteris paribus? Eleven years from now you would like to withdraw $20,000 a year for a period of 5 years (periods 11 through 15) plus the additional amount of $30,000 in year 15. Assuming a growth rate of 8.00%, what amount must you deposit today to make these future withdrawals a reality?
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