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Less Risky Investment A: expected to provide a lump sum cash flow of $5,000 in 6 years with the discount rate of 11% compounded weekly.
Less Risky Investment A: expected to provide a lump sum cash flow of $5,000 in 6 years with the discount rate of 11% compounded weekly. Riskier Investment B: expected to provide a lump-sum cash flow of $5,000 in 6 years with the discount rate of 18% compounded weekly Given this formation, the fair price of Less Risky Investment Ais higher than the fair price of Riskier Investment B. 1) $ 884.91 2) $ 887.59 3) $901.45 4) $ 905.78
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