Question
Q1/ You are expecting to receive $300 at the end of each year in years 3, 4, and 5, and then 500 each year at
Q1/ You are expecting to receive $300 at the end of each year in years 3, 4, and 5, and then 500 each year at the end of each year in years 10 through 25, inclusive. If the appropriate discount rate is 5.8 percent, for how much would you be able to sell your claim to these cash flows today?
Q2/You are paying an effective annual rate of 10 percent on your credit card. The interest is compounded monthly. What is the annual percentage rate on your account?
Q3/Assume you deposit $9,160 at the end of each year into an account paying 12.68 percent interest. How much money will you have in the account in 15 years?
Q4/You expect to receive 1000 bucks every year at the end of each year, starting in year 7 and ending in year 21. If you expect the rate of return is 9.5 percent, and you invest all your cash flows at the going rate as soon as you receive them, how much money will you have at the end of year 25?
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