Question: 2) Using the amounts in the table below and an interest rate of 8% compounded annually, determine (a) the equivalent present amount (b) the equivalent

2) Using the amounts in the table below and an interest rate of 8% compounded annually, determine

(a) the equivalent present amount

(b) the equivalent annual amount (c)

the equivalent future amount at EOY 11 Use the gradient conversion factor, if and where applicable, for full credit.

EOY Deposit

0 100

1 0

2 200

4 500

5 500

6 500

7 500

8 650

9 550

10 450

11 350

3) I have an opportunity to buy a $5000 bond that pays 10% per year and matures in 8 years. What will be my rate of return if I buy the bond today for $6000?

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