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(Solving for i ) You are considering investing in a security that will pay you $5,000 in 27 years. a. If the appropriate discount rate

(Solving for i) You are considering investing in a security that will pay you $5,000 in 27 years.

a.If the appropriate discount rate is 12 percent, what is the present value of this investment?

b.Assume these investments sell for $1,576 in return for which you receive $5,000 in 27

years. What is the rate of return investors earn on this investment if they buy it for $1,576?

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