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Security A pays a single cash flow of $100,000 in five years. Security B pays the same $100,000 but in ten years. The market presently
Security A pays a single cash flow of $100,000 in five years. Security B pays the same $100,000 but in ten years. The market presently discounts both at the same rate. If the rate of discount were to increase for each by 1%, which of the two security prices would decline (in percent) more? OA B Both decline equally because they have the same futurity Cannot answer question without knowledge of the discount rate
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