An investment of ($8,000) is made at time 0 with returns of ($3,500) at the end of

Question:

An investment of $$8,000$ is made at time 0 with returns of $$3,500$ at the end of each of years 1 through 4, with all monetary amounts being in real dollars. Inflation is running 7 percent per year over that time. Also, the real TVOM is 15 percent per year. Determine the investment’s present worth using both real dollars and then-current dollars.

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