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What is the present value of $250 to be paid in two years if

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Reference no: EM13321282

1.APPLICATION Simple Present Value

What is the present value of $250 to be paid in two years if the interest rate is 15%?

2.APPLICATION How Much Is That Jackpot Worth?

As an example of how the present value concept can be used, let s assume that you just hit the $20 million jackpot in a lottery, which promises you a payment of $1 million for the next twenty years. You are clearly excited, but have you really won $20 million?

3.APPLICATION Yield to Maturity on a Simple Loan

If Pete borrows $100 from his sister and next year she wants $110 back from him, what is the yield to maturity on this loan?

Reference no: EM13321282

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