Return would you earn if you made investment

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Reference no: EM139413

Q. 1) If the investment needs the outlay of $400 today, also promises to pay $50 at t = 1, $350 at t = 2, also $150 at t = 3, what compound percentage return would you earn if you made investment?

2) Find out present value of= $20,000 to be received four years from now if discount rate is 10% also discounting is done:

a) Annually?

b) Quarterly?

c) Monthly?

d) Daily? (Suppose all years have 365 days).

3) Find out the effective annual rate of interest for each of below?

a) 8% compounded quarterly.

b) 10% compounded semi-annually

c) 12% compounded monthly.

Reference no: EM139413

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