Question
You have a choice of two investment accounts. Investment A is a 12-year annuity with $1,450 payments at the end of each month and a
You have a choice of two investment accounts.
Investment A is a 12-year annuity with $1,450 payments at the end of each month and a rate of 8%, compounded monthly.
Investment B is a lump-sum investment with an interest rate of 7%, compounded continuously for 12 years.
How much money would you need to invest in Investment B today for it to be worth as much as Investment A 12 years from now?
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Investments Analysis and Management
Authors: Charles P. Jones
12th edition
978-1118475904, 1118475909, 1118363299, 978-1118363294
