9.4 (LG 9.2, 9.3, 9.4) An investment pays $10 000 in five years. a. If inflation is 10 percent per year, what is the real value of the $10 000 in today's dollars? b. If inflation is 10 percent and the real MARR is 10 percent, what is the present worth? c. What current dollar MARR is equivalent to a 10 percent real MARR when inflation is 10 percent? d. Compute the present worth using the current dollar MARR from part (c).

9.4 (LG 9.2, 9.3, 9.4) An investment pays $10 000 in five years. a. If inflation is 10 percent per year, what is the real value of the $10 000 in today's dollars? b. If inflation is 10 percent and the real MARR is 10 percent, what is the present worth? c. What current dollar MARR is equivalent to a 10 percent real MARR when inflation is 10 percent? d. Compute the present worth using the current dollar MARR from part (c).

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter4: Time Value Of Money

Section: Chapter Questions

Problem 15PROB

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