Your father has offered you a choice of one of the three alternatives: 100,000 now; 15,000 a
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Question:
- Your father has offered you a choice of one of the three alternatives: 100,000 now; 15,000 a year for eight years; or 150,000 at the end of eight years, assuming you could earn 10 percent annually, which alternative should you choose?
a) You need 55,750 at the end of eight years, bank is offering you 15 percent interest on your deposit. How much amount should you deposit?
b) On January 1, 2010, Mr. Ashman bought 1000 shares of stock for $130 per share. On December 31, 2014, he sold the stock for 155 per share. What is his annual rate of return?
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