Question
Suppose the term structure of interest rates is shown below: interest rates Term 1 year 2 years 3 years 5 years 10 years 20 years
Suppose the term structure of interest rates is shown below:
| Term | 1 year | 2 years | 3 years | 5 years | 10 years | 20 years |
|---|---|---|---|---|---|---|
| Rate (EAR%) | 5.00% | 4.80% | 4.60% | 4.50% | 4.25% | 4.15% |
The net present value (NPV) of an investment that costs $4320 and pays $1600 certain at the end of one, three, and five years is closest to ________.
$91.37
$137.05
$114.21
- $114.21
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How To Save It Fix Your Finances
Authors: Bola Sol
1st Edition
1529118816, 978-1529118810
