You invest $2130.22 today. Four and a half years later, you see that this investment has grown to $3316.08. What nominal rate of interest, j12, have you been earning?
r = [FV / PV]1/n - 1
= [$3,316.08 / $2,130.22]1/4.5 - 1
= 1.1033 - 1 = 0.1033, or 10.33%
You invest $2130.22 today. Four and a half years later, you see that this investment has...
You have been offered a unique investment opportunity. If you invest $ 15000 today, you will receive $750 one year from now, $2,250 two years from now, and $15,000 ten years from now. a. What is the NPV of the investment opportunity if the interest rate is 6% per year? Should you take the opportunity? b. What is the NPV of the investment opportunity if the interest rate is 2% per year? Should you take the opportunity?
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