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You are considering two investments: A & B. Both investments provide a cash flow of $100 per year for n years. However, investment A receives
You are considering two investments: A & B. Both investments provide a cash flow of $100 per year for n years.
However, investment A receives the cash flows at the beginning of each year, while investment B receives cash flows at the end of the year.
If the PV of cash flows from investment B is P, and the discount rate is r, what is the future value at time n of the cash flows from investment A?
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