Ten years ago Alexander bought an investment property for $100,000.00. Over the 10-year period inflation has held consistently at 2% annually. If Alexander expects a 15%/yr real rate of return, what would he sell the property for today?
Ten years ago Alexander bought an investment property for $100,000.00. Over the 10-year period inflation has held consistently at 2% annually. If Alexander expects a 15%/yr real rate of return, what would he sell the property for today?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Ten years ago Alexander bought an investment property for $100,000.00. Over the 10-year period
inflation has held consistently at 2% annually. If Alexander expects a 15%/yr real rate of return,
what would he sell the property for today?
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