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How much can spend on the trip

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Question 1) You have been offered an investment that will pay you $3,000 in 3 years. If your required return is 8%, how much should you be willing to pay today for this investment?

Question 2) You want to do some traveling in in 3 years. You just received your excess tuition refund of $2,000 and are going to invest this money to put toward the trip. If you feel confident that you can invest it at 7%, how much can you spend on the trip?

Reference no: EM132532762

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