# Question: Assume you invest 5 000 today in an investment that promises

Assume you invest $5,000 today in an investment that promises to return $9,000 in exactly 10 years.

a. Use the present value technique to estimate the yield on this investment.

b. If a minimum return of 9% is required, would you recommend this investment?

a. Use the present value technique to estimate the yield on this investment.

b. If a minimum return of 9% is required, would you recommend this investment?

## Answer to relevant Questions

You invest $7,000 in stock and receive $65, $70, $70, and $65 in dividends over the following 4 years. At the end of the 4 years, you sell the stock for $7,900. What was the yield on this investment? Elliott Dumack must earn a minimum rate of return of 11% to be adequately compensated for the risk of the following investment. Initial Investment $14,000 End of Year Income ($) 1 ...Assume you purchased a bond for $9,500. The bond pays $300 interest every 6 months. You sell the bond after 18 months for $10,000. Calculate the following: a. Income b. Capital gain or loss c. Total return in dollars and as ...What is the time value of money? Explain why an investor should be able to earn a positive return. Find the present value of each of the following streams of income, assuming a 12% discount rate.Post your question