Author Question: At an inflation rate of 9 percent, the purchasing power of 1 would be cut in half in 8.04 years. How ... (Read 43 times)

jace · **on:** Jul 10, 2018

At an inflation rate of 9 percent, the purchasing power of 1 would be cut in half in 8.04 years. How long to the nearest year would it take the purchasing power of 1 to be cut in half if the inflation rate were only 4 percent?

Question 2

Given a positive interest rate and a positive cash flow, an ordinary annuity always has a greater present value than an annuity due of the same size and number of cash flows.

Indicate whether the statement is true or false.

akpaschal · **Reply #1 on:** Jul 10, 2018

Answer to Question 1

Thanks for your help Worked like a charm.

Answer to Question 2

Answer: FALSE
Explanation: The annuity due is always greater.