Suppose a company has a liability to pay $100,000 in two years. The company has two investment

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Suppose a company has a liability to pay $100,000 in two years. The company has two investment options to choose from:

Option A: Invest $80,000 today at 5% compounded annually for two years.

Option B: Invest $70,000 today at 6% compounded annually for two years.

Which investment option should the company choose in order to ensure it can meet its liability in two years? Show all calculations and explain your answer.

Related Book For answer-question

Intermediate Microeconomics and Its Application

ISBN: 978-0324599107

11th edition

Authors: walter nicholson, christopher snyder

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Posted Date: Mar 16, 2023 02:58 AM

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Suppose a company has a liability to pay $100,000 in two years. The company has two investment

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Intermediate Microeconomics and Its Application

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