There are three investments being offered to you; one pays you $100,000 at the end of 10 years; another one pays you $90,000 at the end of 9 years; and the other one $130,000 at the end of 11 years. If your required return on investment is 10%, which would you pick?

There are three investments being offered to you; one pays you $100,000 at the end of 10 years; another one pays you $90,000 at the end of 9 years; and the other one $130,000 at the end of 11 years. If your required return on investment is 10%, which would you pick?

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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Question

There are three investments being offered to you; one
pays you $100,000 at the end of 10 years; another one
pays you $90,000 at the end of 9 years; and the other
one $130,000 at the end of 11 years. If your required
return on investment is 10%, which would you pick?

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