posted
Yes, there is. However, this really sounds like you tryign to get people to do your homework for you, which is not something we do here.
Posts: 10177 | Registered: Apr 2001
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posted
Sorry, it's not homework. It's something that was explained poorly in the book and I was hoping for a better explanation.
Posts: 1215 | Registered: Apr 2005
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Let me ask you a question: if I give you a dollar a year for eternity, how much money will you have at eternity?
Posts: 5462 | Registered: Apr 2005
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What's n? Are you supposed to just present the formula where n equals the year between here and eternity, or are you actually supposed to come up with an answer?
Posts: 5462 | Registered: Apr 2005
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No, I just wasn't sure how to answer your question. We're trying to figure out worth, more or less what we'd pay for it today.
What I was thinking was: [cost of the object] x [interest rate] = [yearly income from object]-> [cost] x .05 = $5 So the cost would be $100, right?
But now I'm a bit confused because I would have thought it'd be worth more than that. That and I'm not sure what purpose the interest rate serves.
Posts: 1215 | Registered: Apr 2005
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