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Discount rate

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 ?

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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