Question
Your loving aunt has loaned you sum of $1000 at a 0% effective annual rate. Which of the following cashflow streams would you prefer in
Your loving aunt has loaned you sum of $1000 at a 0% effective annual rate. Which of the following cashflow streams would you prefer in order to repay the loan? (Assume that the interest rate in the market is greater than zero.)
|
| Year 1 | Year 2 | Year 3 | Year 4 |
| I | 400 | 300 | 200 | 100 |
| II | 100 | 200 | 300 | 400 |
| III | 250 | 250 | 250 | 250 |
| III | ||
| Insufficient information. Need to know the discount rate to answer the question
| ||
| II | ||
| I |
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Income Tax Fundamentals 2013
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
31st Edition
9781285586618
