inflation rate is 5% real terminal value will be 50,000 in 5 yrs. What is the...

Question

Question

inflation rate is 5%

real terminal value will be 50,000 in 5 yrs.

What is the nominal terminal value of the investment at the end of the fifth year?

Answer 1

Answer #1

Please find below the solution.. let me know if you need any clarification.

Computation of nominal terminal value

Nominal terminal value =	50000*(1+5%)^5
Nominal terminal value =	63814.08

Ans =		63814.08

Answer 2

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