Problem 1. Could you explain why debtors benefit during periods of high inflation. Why would someone in Argentina want to have debt and why does money have a time value?
Problem 2. Also, how is the present value of a lump sum related to the present value of a stream of payments? How is this helpful for retirees that are considering taking a lump sum payment in lieu of monthly pension payments?
Problem 3. What are the three factors that influence the required rate of return by investors?