At an annual effective interest rate

(Problem 13.4) David can receive one of the following two payment streams:
(i) 100 at time 0, 200 at time n, and 300 at time 2n
(ii) 600 at time 10
At an annual effective interest rate of i, the present values of the two streams are equal.
Given νn = 0.75941, determine i.

 

 

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