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You are given the series of cash flows shown in the following table:

2218_Tab.jpg

a. Calculate the compound annual growth rate associated with each cash flow stream.

b. If year 1 values represent initial deposits in a savings account paying annual interest, what is the annual rate of interest earned on each account?

c. Compare and discuss the growth rate and interest rate found for each cash flow stream in parts (a) and (b), respectively.

Financial Management, Finance

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