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Author: valuemoosie Big gold star, 5000 posts Old School Fool Coverage Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore)
of 1817  
Subject: Re: What's in Your Portfolio?
Date: 4/4/2008 11:47 PM
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Jordan,

Start with year zero's earnings of 203. For each year:

[ 203 * (1 + .07)^n  ] / (1 + .10)^n

where "n" is year 1,2,3,4,5.

The first part of the formula is the future value at 7% growth, and the second part discounts it back to the present at 10%.

It adds up to 935.

-joe
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