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Compute what rate of return are offering on the investment

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Reference no: EM132754204

Problem 1: Someone offers to sell to you a financial contract that will pay $150 at the end of each of the next five years, plus an additional $1000 at the end of the fifth year. If they will sell the contract for $850, what rate of return are they offering on the investment?

Option 1: 7.7
Option 2: 11.8
Option 3: 20.02
Option 4: 20.58
Option 5: 105.88
Option 6: 205.88

Reference no: EM132754204

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