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Midterm_1_Summer2022 Solutions.pdf - Midterm 1 SUMMER 2022...

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Midterm 1SUMMER 2022
Problem 1What is the annuity factor of a 90-month annuity with a monthly interest rate of 1%. Assumemonthly payments, with 90 payments starting one month from today.
Problem 2Martha will invest in a project that requires $900,000 to be invested today. If she will receive$5,000,000 in five years, what is the annual internal rate of return for this investment?
Problem 3A bank deposit will earn a 6% stated annual interest, compounded continuously. How manyyears are necessary for the amount in the account to double? Assume no other deposits orwithdrawals.

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Term
Spring
Professor
Lim

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