Payment using actual and constant dollar analysis

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 A company of $20,000 is to be received 10 years hence, followed by a $40,000 payment 17 years from the present. If over this time span the annual inflation rate is 5% while the expected annual market rate is 9%, calculate the present equivalent these two payment using

a. Actual – dollar analysis

b. Constant – dollar analysis

Reference no: EM131318821

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