Explore BrainMass
Share

Explore BrainMass

    Time Value of Money - Yield with Interpolation

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    Have no idea how to start this problem. Step by step instruction will be great.

    Ester Seals has just given an insurance company $41,625. In return, she will
    receive an annuity of $5,000 for 15 years. At what rate of return must the
    insurance company invest this $41,625 to make the annual payments?
    Interpolate.

    © BrainMass Inc. brainmass.com October 9, 2019, 8:20 pm ad1c9bdddf
    https://brainmass.com/business/capital-budgeting/time-value-money-yield-interpolation-147425

    Solution Preview

    Ester Seals has just given an insurance company $41,625. In return, she will
    receive an annuity of $5,000 for 15 years. At what rate of return ...

    Solution Summary

    This solution calculates the rate of return from cash flow data over 15 years. All formulas and workings are shown enclosed in an Excel file.

    $2.19