If the real rate of interest is 1.75% and if the expected inflation rate is 8.65%, what is the present value of $50,000 to be received exactly 8 years from today?

2. You expect to deposit the following cash flows at the end of years 1 through 5, $1,000; $4,000; $9,000; $5,000; and $2,000 respectively. What is the future account value at the end of year 20 if you can earn 10% p.a., compounded continuously?

Answer rating: 100% (QA)

Part 1 Present Value with Inflation 1 Nominal Interest Rate We dont directly use the nominal interes... View the full answer