What is equivalent annual annuity

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1. A trader enters into a short position in ten Eurodollar futures contract (sell 10 contracts). How much does the trader gain (or lose) when the futures price quote increases by 15 basis points?

2. Suppose a project has initial outlay of $12,000 and after-tax cash flows of $2,000 each year for first three years and $4,000 each year for the following three years. If the required rate of return is 6.50%, what is the equivalent annual annuity?

Reference no: EM131998486

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