Question: What is the answer to the question below? Time valuePersonal Finance ProblemJim Nance has been offered an investment that will pay him $500 three years

What is the answer to the question below?

Time valuePersonal Finance ProblemJim Nance has been offered an investment that will pay him $500 three years from today.

If Jim can purchase this investment for less than the amount calculated in part (a), what does that imply about the rate of return that he will earn on the investment?

If Jim pays less than $408.15 computed in part a for the investment, his rate of return will be the opportunity cost of 7%.

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