Find terminal values for investment

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You invest $1,000 in a large company stock and $1,000 in a corporate bond. If you earn 10.0 percent on the stock and 6.0 percent on the bond and hold each security for 10 years, what are the terminal values for each investment? If you continue to hold each security and earn the same returns for 20 years, how much more will the stock generate than the bond over the entire time period? (When you invest for retirement or to finance a child's college education, you should think about the answer to this problem.)

Reference no: EM133120005

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