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This is a problem set from my individual work in the course of Economic.
A businessman plans to earn 10 000 UAH in 2018, and additionally 50 000 UAH in 2020. His discounted income equals to 40 000 UAH.

Find the interest rate (r). Explain your calculations.

I have no idea what to do. As I understood all my income which I will get in the future (50 000 + 10 000) is equal to 40 000 at the moment. So $60 000 = 40 000$ and so $r=0.66$ but it`s too straight and I have no idea how to solve it another way.

callculus42
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Pava
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  • It is now 2019 and soon 2020, when is the $40000$ UAH valued at? – peterwhy Dec 22 '19 at 19:09
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    If 40,000 is the equivalent present value in 2018 of the two incomes then the equation should be $\frac{10,000}{1+r}+\frac{50,000}{(+r)^3}=40,000$. In general exercises with a few words only are usually not well phrased. – callculus42 Dec 22 '19 at 19:16
  • @peterwhy I gave all the information I have, I have no idea when 40 000UAH are valued at – Pava Dec 22 '19 at 19:43

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