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Monday, January 18, 2010

A Voyage Estimation Question - who knows the answer?

If you bought a house 10 years ago for USD 100,000 dollars and sold it this year for USD 150,000 have you made a profit?

And yes thisis a voyage estimation question...once i get some answers I will explain.

Rgds
VS

5 comments:

  1. I believe we would need to find out the net present value of the initial 100K in order to compare USD 100K in 2000 and USD 150K in 2010. (a matter of interest and inflation)

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  2. Emre - yes you are right but my question is a little broader than that. I will answer in a post.

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  3. Thanks - have read your answer, but I still believe that the NPV of USD 100K in 2000 also has to be compared with the best possible fixture in 2010 (in this case, the 200K in your answer).

    Cheers for the challenge :)

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  4. Emre - you are 100 percent correct. My answer is more in relation to a 'tading profit' rather than a 'real or accounting profit'.

    You must have an MBA! Thanks again.

    VS

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  5. above should reading 'trading profit' not tading...

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