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You are the chief financial officer of a firm. The firm has an expected liability
Economics
You are the chief financial officer of a firm. The firm has an expected liability (cash outflow) of $2 million in ten years at a discount rate of 5%.
· Calculate the amount the firm would need on the present date as savings to cover the expected liability.
· Calculate the amount the firm would need to set aside at the end of each year for the next ten years to cover the expected liability.
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