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An investment product promises to pay $61,000 at the end of 10 years. If an investor...

An investment product promises to pay $61,000 at the end of 10 years. If an investor feels this investment should produce a rate of return of $11%, compounded annually, what's the most the investor should be willing to pay for the investment?(FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)

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Answer #1

PV = FV * PVF(r%,n)

= $61,000 * PVF(11%,10)

= $61,000 * 0.3522 = $21,483.25

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