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(Related to Checkpoint 5.6) (Solving for i ) You are considering investing in a security that will pay you $5,000 in 26 years. a. If
(Related to Checkpoint 5.6) (Solving for i ) You are considering investing in a security that will pay you $5,000 in 26 years. a. If the appropriate discount rate is 10 percent, what is the present value of this investment? b. Assume these investments sell for $2,457 in return for which you receive $5,000 in 26 years. What is the rate of return investors earn on this investment if they buy it for $2,457? a. If the appropriate discount rate is 10 percent, the present value of this investment is $33,789. (Round to the nearest cent.) (Related to Checkpoint 5.6) (Solving for i ) You are considering investing in a security that will pay you $5,000 in 26 years. a. If the appropriate discount rate is 10 percent, what is the present value of this investment? b. Assume these investments sell for $2,457 in return for which you receive $5,000 in 26 years. What is the rate of return investors earn on this investment if they buy it for $2,457? a. If the appropriate discount rate is 10 percent, the present value of this investment is $33,789. (Round to the nearest cent.)
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