A series of four annual constant-dollar payments beginning with $50,000 at the end of the first year is growing at the rate of 8% per year. Assume that the base year is the current year (n = 0). If the market interest rate is 16% per year and the general inflation rate (f) is 10% per year, find the present worth of this series of payments, based on(a) constant-dollar analysis.(b) actual-dollar analysis.
A series of four annual constant-dollar payments beginning with $50,000 at the end of the first year is growing at the rate of 8% per year. Assume that the base year is the current year (n = 0). If the market interest rate is 16% per year and the general inflation rate (f) is 10% per year, find the present worth of this series of payments, based on
(a) constant-dollar analysis.
(b) actual-dollar analysis.
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A series of four annual constant-dollar payments beginning with $7,000 at the end of the first year is growing at the rate of 8% per year. Assume that the base year is the current year (n=0). If the market interest rate is 13% per year and the general inflation rate is 7% per year, find the present worth of this series of payments on
(a) Constant-dollar analysis
(b) Actual –dollar analysis
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