Explore BrainMass

Explore BrainMass

    Discount rate

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

    What is your personal discount rate or rate of preferences? I.e. how much would you pay for a promise of $1000 to be received one year from now? Would you discount it by 10%, 5%, etc? and why ?

    © BrainMass Inc. brainmass.com October 2, 2020, 12:39 am ad1c9bdddf
    https://brainmass.com/business/discounted-cash-flows-model/discount-rate-338959

    Solution Preview

    Discount rate, by convention, is the current interest rate.

    The current rate 2.63%, so that should be the person's discount rate.

    Why is this? Because if someone's discount rate is not 2.63%, then there ...

    Solution Summary

    Discount rate

    $2.19

    ADVERTISEMENT