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Unformatted text preview: i.e. life insurance or mortgage PVA= PMTxPVIFA PVIFA= (1-1/(1+i)^n)/i PMT= payment Interest up, price of bond downinterest down, price of bond up Higher interest rates lead to capital losses to a lot of people which leads to recession As interest increases investment decreases and when interest declines investment increases...
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- Fall '07