what are you getting in terms of interest rate if you are willing to pay $15,000
ID: 2811693 • Letter: W
Question
what are you getting in terms of interest rate if you are willing to pay $15,000 today for an annual stream of payments of $2,000 for the next 20 years? The next 40 years? The next 100 years? Forever? what are you getting in terms of interest rate if you are willing to pay $15,000 today for an annual stream of payments of $2,000 for the next 20 years? The next 40 years? The next 100 years? Forever? what are you getting in terms of interest rate if you are willing to pay $15,000 today for an annual stream of payments of $2,000 for the next 20 years? The next 40 years? The next 100 years? Forever?Explanation / Answer
use excel formula=RATE(nper,pmt,pv,fv)
what are you getting in terms of interest rate (next 20 years)
=RATE(20,2000,-15000,0)
=11.93%
what are you getting in terms of interest rate (next 40 years)
=RATE(40,2000,-15000,0)
=13.24%
what are you getting in terms of interest rate (next 100 years)
=RATE(100,2000,-15000,0)
=13.33%
what are you getting in terms of interest rate for FOREVER
=2000/15000
=13.33%
the above is answer..
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