Question
You are considering investing in a security that will pay you $1,000 in 31 years. a.If the appropriate discount rate is 12 percent, what is
You are considering investing in a security that will pay you
$1,000
in
31
years.
a.If the appropriate discount rate is
12
percent,
what is the present value of this investment?
b.Assume these investments sell for
$171
in return for which you receive
$1,000
in
31
years. What is the rate of return investors earn on this investment if they buy it for
$171?
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Risk Management And Financial Institution
Authors: John C. Hull
2nd Edition
0136102956, 9780136102953
