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Question 4 Not yet answered You observe that a big-screen television can be purchased for nothing down today and $40,000 due in one year. That
Question 4 Not yet answered You observe that a big-screen television can be purchased for nothing down today and $40,000 due in one year. That is CFO and CF, = $40,000. The store next door offers an identical television for $36,700 but does not offer credit terms. That is CF, = $36,700 and CF, = 50. What is the market interest rate if present value (PV) of the two payments at today are the same? Marked out of 5.00 P Flag question Select one: a. None of the answers b. About 9.59% c. About 9.44% d. About 9.29% How much must be invested today (PV) in order to generate a four-year (ordinary) annuity of $100 per year, with the first payment one year from today (t = 1), at an interest rate of 10%? Question 5 Not yet answered Marked out of 5.00 Select one: a. $316.99 b. $360.48 P Flag question c. $374.63 d. None of the answers Question 6 The profitability index for a project costing $40,000 and returning $15,000 annually for four years at an opportunity cost of capital of 12% is: Not yet answered Marked out of 5.00 Flag Question Select one a. 0.320 b. 0.139 c.0.500 d. None of the answers
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