Author Question: Capital AccumulationSuppose you lend 10,000 to a friend for a year. In that year, the real rate of ... (Read 89 times)

xsk4r3kr0w · **on:** Nov 23, 2022

Question 1

Financial Markets

You are considering buying a machine that costs $1,211.79. If purchased, the machine yields the income stream shown in the table for the next 7 years.

Year	Income
1	485
2	275
3	390
4	330
5	0
6	0
7	0

Would you buy the machine if the interest rate was 8%? 10%?
◦ no, no
◦ no, yes
◦ yes, no
◦ yes, yes

Question 2

Capital Accumulation

Suppose you lend 10,000 to a friend for a year. In that year, the real rate of return in the stock market is 4%. What is the minimum amount your friend needs to pay you back to make the loan worthwhile?
Please round your final answer to two decimals.
◦ $10,400.00
◦ $20,000
◦ $9,600.00
◦ $10,000

labrinker · **Reply #1 on:** Nov 23, 2022

A FREE account is required to view all solutions!

Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.

Answer Preview

Only 35% of students answer this correctly