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Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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![Problem 9-34 (Algo) Yield on Investment [LO9-4]
C. D. Rom has just given an insurance company $46,500. In return, he will receive an annuity of $6,600 for 20 years.
At what rate of return must the insurance company invest this $46,500 in order to make the annual payments? Use Appendix D for an
approximate answer, but calculate your final answer using the financial calculator method.
Note: Do not round Intermediate calculations. Round your final answer to 2 decimal places.
Rate of return
6.35 %](https://content.bartleby.com/qna-images/question/e23feda9-6680-4714-bad5-eb3bad054451/cdd4e316-7f9e-4b53-bbd1-c0d5939c5c40/pcys0rg_thumbnail.png)
Transcribed Image Text:Problem 9-34 (Algo) Yield on Investment [LO9-4]
C. D. Rom has just given an insurance company $46,500. In return, he will receive an annuity of $6,600 for 20 years.
At what rate of return must the insurance company invest this $46,500 in order to make the annual payments? Use Appendix D for an
approximate answer, but calculate your final answer using the financial calculator method.
Note: Do not round Intermediate calculations. Round your final answer to 2 decimal places.
Rate of return
6.35 %
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