Use your calculator to check the discount factors for the present value of 1 at the end
Question:
Use your calculator to check the discount factors for the present value of £1 at the end of one year, two years and three years for a discount rate of 10%. Write a parallel table for 8 per cent and 12 per cent. Show that the discount factor decreases as the discount rate increases.
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Since the discount factor is calculated using the formula 11 rn where r is the discount rate and n i...View the full answer
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