If the market rate of interest is 8% per year, what is the present value of an amount of $10,000 to be received after: a) five years. b) ten years

What will be an ideal response?


a) Present value of $10,000 to be received after five years = $10,000/(1.08 )5 = $6,805. 53.
b) Present value of $10,000 to be received after ten years = $10,000/(1.08 )10 = $4,631.94.

Economics

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What will be an ideal response?

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