The rate of return earned over the unspecified time period

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1. For the investment shown in the following table, calculate the rate of return earned over the unspecified time period.

Cash flow during period $950

Beginning-of- period value 12,300

End-of- period value $13,100

The rate of return on the investment is %___

2. you are comparing two seprate invesments. each one is for a period of 10 years and pays 2.500 a year. you require 10 percent return on these invsments. Invesement A pays at the begining of each year and investment B pas at the end of each year. Given this situation, which one of the following statment is accurate:

a. both invsment are equally valuble today.

b. insment b is worth more today because of the timing of its cash flows.

c.Invsement A is worth more today because you wil recive ten payments hwereas invsment B only pays nine payments

d. insment B has both a higher present value and a higher future value than invsment B

e. insment a has a higher present value and lower future value than invsment B.

Reference no: EM132003364

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