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If the discount rate is 10% , how do we calculate the discount rate of the next 5 years????
Thanks in Advance
on calculator for Discount factor:
year 11.1^-1 = .909090
year 2
1.1^-2 = ..82644
for year 5
1.1^-5 = .62092just change the power as per year..
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No I don’t got it. When I made 1.1 to the power of 1, I got 1.1
1.1 to the power of 2 = 1.21But where do u got 1.1 ?????
discount factor is 10%. when you divide 10 by 100 you will get .1
here 1 is of formula..and please check i have written – minus sign with power..
Calculate for year 1, year 2, year 3 and year 4 and add them all together
In the exam, this will be given to you within the question
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