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Dima020 [189]
3 years ago
12

Your parents have made you two offers. The first offer includes annual gifts of $10,000, $11,000, and $12,000 at the end of each

of the next three years, respectively. The other offer is the payment of one lump sum amount today. You are trying to decide which offer to accept given the fact that your discount rate is 8 percent. What is the minimum amount that you will accept today if you are to select the lump sum offer?
Business
1 answer:
Diano4ka-milaya [45]3 years ago
6 0

Answer:

$28,216

Explanation:

The computation of the minimum amount that you will accept today i.e present value is shown below:

Year            Cash flows          Discount factor                Present value

1                   $10,000.00 0.9259259259           $9,259.26

2                  $11,000.00         0.8573388203           $9,430.73

3                  $12,000.00 0.793832241                   $9,525.99

Total present value                                                          $28,215.97

The discount factor should be computed by  

= 1 ÷ (1 + rate)^years

     

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3 years ago
Ben katchor used _____ to create multiple locations for the production of the slugbearers of kayrol island.
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3 years ago
Which of the following is true about duration and modified duration?
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Answer:

The truth about Macaulay Duration and Modified Duration is:

d. All are true.

Explanation:

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On the other hand, the Modified Duration, providing a risk measure by being sensitive to interest rates, identifies the amount by which the duration changes for each percentage change in the yield and, at the same time, measures how the amount of a change in the interest rates impacts a bond's price.

4 0
3 years ago
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lakkis [162]

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5 0
1 year ago
What is a stock exchange?
liraira [26]

Answer:

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Explanation:

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A stock market, in simple words, is the marketplace for the buying and selling of investments, a trading place for buyers and sellers. So, a stock exchange is a transaction dealing with stocks, equities, or shares of the commercial world. And the transaction or exchange can only be done if the stock is listed on an exchange.

Thus, the correct answer is option A.

6 0
3 years ago
Read 2 more answers
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