Suppose you invest $2,000 today and receive $9,500 in five years.
a. What is the internal rate of return? (IRR) of this? opportunity?
b. Suppose another investment opportunity also requires $2,000 upfront, but pays an equal amount at the end of each year for the next five years. If this investment has the same IRR as the first? one, what is the amount you will receive each? year?