What is the rate of return investors earn on this investment

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Reference no: EM133291028

Question: A. Kirk Van? Houten, who has been married for 22 years, would like to buy his wife an expensive diamond ring with a platinum setting on their? 30-year wedding anniversary. Assume that the cost of the ring will be

?$10,000 in 8 years. Kirk currently has $4,537 to invest. What annual rate of return must Kirk earn on his investment to accumulate enough money to pay for the? ring?

B. You are considering investing in a security that will pay you ?$3,000 in 28years.

B1.If the appropriate discount rate is 10 percent?, what is the present value of this? investment?

B2.Assume these investments sell for ?$805 in return for which you receive $3,000 in 28 years. What is the rate of return investors earn on this investment if they buy it for $805??

Reference no: EM133291028

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