Question
In: Finance
What percentage and amount of years will produce the lowest present value interest factor? 8 percent...
What percentage and amount of years will produce the lowest present value interest factor?
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8 percent interest for 5 years |
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6 percent interest for 5 years |
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6 percent interest for 10 years |
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8 percent interest for 10 years |
Solutions
Expert Solution
As per PVIF table:
present value interest factors for the given:
8% interest for 5 Years = 0.6806
6% interest for 5years= 0.7473
6% interest for 10 years = 0.5584
8% interest for 10 years = 0.4632
Answer; 8% interest for 10 years will produce lowest present value interest factor
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