question archive Suppose you can invest 20,000 in an investment fund that guar- antees a 10,000 cash flow after 2 years, another one for 8,000 after 3 years and final one of 6,000 after 5 years
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Suppose you can invest 20,000 in an investment fund that guar- antees a 10,000 cash flow after 2 years, another one for 8,000 after 3 years and final one of 6,000 after 5 years. Would you invest knowing that the annual interest rate is 7%? What if the interest rate were 5%?
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