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  1. business
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  3. 13. implied interest rate and period aa aa e. cons

13. Implied interest rate and period Aa Aa E. Consider the case of the following...

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Accounting

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13. Implied interest rate and period Aa Aa E. Consider the case of the following annuities, and the need to compute either their expected rate of return or duration. Raul inherited an annuity worth $4,851.15 from his uncle. The annuity will pay him four equal payments of $1,400 at the end of each year. The annuity fund is offering a return of 7.08% 6.00% 8.10% Raul's friend, Nicholas, wants to go to business school. While lill share some of the expenses, Nicholas still 5.22% needs to put in the rest on his own. But Nicholas has no money savea r it yet. According to his calculations, it will cost him $60,657 to complete the business program including tuition, cost of living, and other expenses. He has decided to deposit $5,500 at the end of every year in a mutual fund, from which he expects to earn a fixed 9% rate of return. It will take approximately years for Nicholas to save enough money to go to business school

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