You are offered $900 after four years (Offer 1) or $200 a year for four years (Offer 2). If you can earn 7 percent on
You are offered $900 after four years (Offer 1) or $200 a year for four years (Offer
2). If you can earn 7 percent on your funds, calculate the future values of both payments. Use Appendix C to answer the question. Round your answers to the nearest dollar. FV(Offer
1): $ FV(Offer
2): $ Which offer will you accept? If you can earn 18 percent on your funds, calculate the future values of both payments. Use Appendix C to answer the question. Round your answers to the nearest dollar.
FV(Offer 1):
$ FV(Offer 2):
$ Which offer will you accept, if you can earn 18 percent on your funds?
Why are your answers different? The choices are different as the higher interest rate .
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Authors: Ralph Tench, Stephen Waddington
5th Edition
1292321741, 9781292321745
