Question
You are considering investing in a security that will pay you $5,000 in 31 years. a.If the appropriate discount rate is 8 percent, what is
You are considering investing in a security that will pay you
$5,000
in
31
years.
a.If the appropriate discount rate is
8
percent,
what is the present value of this investment?
b.Assume these investments sell for
$1,675
in return for which you receive
$5,000
in
31
years. What is the rate of return investors earn on this investment if they buy it for
$1,675?
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Financial Management Core Concepts
Authors: Raymond M Brooks
3rd edition
133866696, 978-0133866698
