Your Father Paid $10,000 (CF at T = 0)for an Investment

question 161

Multiple Choice

Your father paid $10,000 (CF at t = 0) for an investment that promises to pay $750 at the end of each of the next 5 years,then an additional lump sum payment of $10,250 at the end of the 5th year.What is the expected rate of return on this investment?

• A) 7.93%
• B) 3.16%
• C) 10.08%
• D) 8.39%
• E) 8.83%

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Definitions:

Fusion Reactors

Devices designed to generate energy by fusing atomic nuclei together, a process similar to what happens in the sun.

Additive Manufacturing

A process of creating three-dimensional objects by adding layer upon layer of material, commonly referred to as 3D printing.

Economies of Scale

The cost advantages that enterprises obtain due to their scale of operation, resulting in cost per unit of output decreasing with increasing scale.

3-D Printers

Technology that creates three-dimensional objects from digital models by layering materials.