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Effective interest rate 1. The cash flow for an alternative is: Q1 | Q2 Q3Q4 Q5 Q6 Q7 Q8 Quarter Cash flow 100010001000100010001000 PV-A(P/A,i,n) 1000

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Effective interest rate 1. The cash flow for an alternative is: Q1 | Q2 Q3Q4 Q5 Q6 Q7 Q8 Quarter Cash flow 100010001000100010001000 PV-A(P/A,i,n) 1000 1 000 a. Calculate the present value ifthe interest rate is 12% compounded semi-annually and n 4.(Answer: 6930.2) n 8. (Answer: 7019.7) n-8. (Answer: i-3.0390 P : 7010) n 24. (Answer: A-330 P-7010) and n-8. (Answer: i-3.045% P-7006) b. Calculate the present value if the interest rate is 12% compounded quarterly and C. Calculate the present value if the interest rate is 12% compounded monthly and d. Calculate the present value if the interest rate is 12% compounded monthly and e. Calculate the present value if the interest rate is 12% compounded continuously

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