You are buying an investment product that costs $50,000 today. the annual interest rate is 5% and the investment period is 3 years. the investment will repay you $15,000 at the end of year 1 and $10,000 at the end of year 2. based on economic equivalent value of the investment, how much should you receive at the end of year 3? round the answer to the nearest integer. (e. g. round 10.25 to 10, round 10.78 to 11)

year 3 cashflow: 23,212

Explanation:

economic equivalent value of the investment: This means the investment will have a return of 5%. Si we must calculate which cahs flow makes the NPV equal to zero.

We should  solve for "x"

x =  23,211.96268 = 23,212

The third cashflow will need to be of 23,212 to make the investment equivalent at 50,000 at 5% discount rate.

the investment was $14,174.196

explanation:

a lump sum means that the father of the example made one deposit and leave it be.

we need to know the value of a capital that generated at 4.05% per year during 28 years the sum of $48,613.24

now clearing the formula to solve for capital we got:

and we reach the answer investment = $14,174.20

you will have $2593.74 in 10 years if you set aside $1,000 at 10%

you will have $9321.91 in 20 years if you set aside $2000 at 8%

you will have $1469.32 in 5 years if you set aside $1000 at 8%

you will have $1296.87 in 10 years if you set aside $500 at 10%

you will have $239.66 in 15 years if you set aside $100 at 6%

you will have $4660.96 in 20 years if you set aside $1000 at 8%