Question
Jose enters into agreement in which he will pay $100,000 today and $101,000 two years from now in exchange for receiving $200,000 one year from
Jose enters into agreement in which he will pay $100,000 today and $101,000 two years from now in exchange for receiving $200,000 one year from now.
a) Find the net present value of this transaction (from Jose's perspective) if i = 3.5%.
b) Find the yield rate (IRR), if possible. What does your answer imply about the graph of P(i), the net present value as a function of i?
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Finance For Real Estate Development
Authors: Charles Long
1st Edition
0874204305, 978-0874204308
