1. what single investment made today earning 10% annual interest, will be worth $5000 at the end of six years?
2. What is the present value of $5000 to be received at the end of 6 years if the discount rate is 10%?
3. What is the most you would pay today for a promise to repay you $5000 at the end of 6 years if your opportunity cost 10%?
Compare, contrast, and discuss your findings in parts 1 through 4.
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This question was asked on Jan 26, 2013 and answered on Jan 27, 2013.
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