Homework Answers
1)
i = 10%
PV = Amount invested today
PV = 40000/(1 + 10%)20 + 40000/(1 + 10%)21 + ...... + 40000/(1 + 10%)38
PV = $ 54709
2)
i = 15%
PV = Amount invested today
PV = 40000/(1 + 15%)20 + 40000/(1 + 15%)21 + ...... + 40000/(1 + 15%)38
PV = $ 17421
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