Question
Would you be willing to pay $24,099 today in exchange for $100,000 in 30 years? What would be the key considerations in answering yes or
Would you be willing to pay $24,099 today in exchange for $100,000 in 30 years? What would be the key considerations in answering yes or no? Would your answer depend on who is making the promise to repay?
Return required in 30 years is calculated below:
The key consideration for ready to exchange is getting a return of 4.86% per year.
The decision of exchange will also depends on other certain factors, such as credit rating of other party and inflation rate.
Thus, there is no rigid answer for this question. However, depends on given conditions.
QUESTION:
So for you personally what percentage of return do you need to have before you will consider to putting your money down?
24,099 x (1 + i) 30 = 100,000 (1+) = 4.149549 (1+i) = 1.0486 i= 0.0486Step by Step Solution
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