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their son plans to attend college. What is the duration of this liability to the couple if they can borrow and lend at the market interest rate of 10.8 percent? (Do not round

their son plans to attend college. What is the duration of this liability to the couple if they can borrow and lend at the market interest rate of 10.8 percent? (Do not round

Essentials Of Investments
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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Ted and Alice Hansel have a son who will begin college 10 years from today. School expenses of $48,000 will need to be paid at the beginning of each of the four years that their son plans to attend college. What is the duration of this liability to the couple if they can borrow and lend at the market interest rate of 10.8 percent? (Do not round intermediate calculations and round your answer to 5 decimal places, e.g., 32.16161.) Answer is complete but not entirely correct. 10.09238 Duration
Transcribed Image Text:Ted and Alice Hansel have a son who will begin college 10 years from today. School expenses of $48,000 will need to be paid at the beginning of each of the four years that their son plans to attend college. What is the duration of this liability to the couple if they can borrow and lend at the market interest rate of 10.8 percent? (Do not round intermediate calculations and round your answer to 5 decimal places, e.g., 32.16161.) Answer is complete but not entirely correct. 10.09238 Duration
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