Suppose that you have a choice between receiving $10,000 now and receiving $1000 per month for the next 12 months. Assuming that you can invest at a 12% annual percentage rate (APR) with monthly compounding. What is the break-even annual rate of return at which you are indifferent between receiving $10,000 now and receiving $1000 per month for 12 months?

Answer rating: 100% (QA)

The breakeven annual rate of return in this scenario is 12 This means that if you can invest the 100... View the full answer