Question \#6 - RATE (Interest Rate \& Growth Rate) RATE: Calculates the interest rate per period of an annuity. If the successive results of RATE do not converge after 20 iterations, RATE returns the \#NUMI value. RATE(nper,pmt,pv,fv,type,guess) - nper-number of periods - pmt-amount of the payment - PV - beginning balance (principal) of the loan - FV - the future value or cash balance at the end of the loan. - Type - 0 payment at end of period, 1 payment at beginning of period. Q6. (a) An annuity pays $173.00 each period for 13 periods, and the present value is $513.94. What is the discount rate per period of this annuity? (b) Suppose that you were approached with an offer to purchase an investment which will provide cash flows of $1,500 per year for ten years. The cost of purchasing this investment is $10,500. If you have alternative investment opportunity, of equal risk which will yield 89 per year which should you accept and why