The required rate of return for an asset is equal to the risk-free rate plus a risk premium.
Indicate whether the statement is true or false
Question 2
You are about to purchase a new car from a dealer who has a new and unusual payment plan. You have the choice to pay 28,000 cash today or 31,000 in four years.
If you have the opportunity to borrow the cash price value of the car at a rate of 2.5 and repay the loan in a lump sum in 4 years, which option should you take and why?
A) Pay the 31,000 in the future because it it always better to delay payment for new assets.
B) Pay the 31,000 in the future because the PV is less than 28,000 today.
C) Pay the 28,000 cash today even if you need to borrow the money because the FV of the repayment in 4 years is only 30,906.76.
D) Pay the 28,000 cash today because you pay a full 3,000 less than if you wait and pay the other option as presented.
Risk for injury
Nursing care plan - risk for infection
Free Energy
Population growth rate %
Risk assessment analyzes
Foods made with fat substitutes aren’t calorie free