Find the present value of the streams of cash flows shown in the following table, Assume...
Find the present value of the streams of cash flows shown in the following table,
Assume that the firm's opportunity cost is
12%.
a. The present value of stream A is
$
(Round to the nearest dollar.)
Enter your answer in the answer box.
(Click on the icon located on the top-right corner of the data
table below in order to copy its contents into a spreadsheet.)Data
Table
|
A |
B |
C |
|||||||||
|
Year |
Cash Flow |
Year |
Cash Flow |
Year |
Cash Flow |
||||||
|
1 |
−$2,000 |
1 |
$11,000 |
1−5 |
$11,000/yr |
||||||
|
2 |
$3,100 |
2−5 |
$5,100/yr |
6−10 |
$8,100/yr |
||||||
|
3 |
$4,000 |
6 |
$7,000 |
||||||||
|
4 |
$6,000 |
||||||||||
|
5 |
$8,000 |
||||||||||
Homework Answers
present value = future value / (1 + cost of capital)n
where n = number of years after which the cash flow occurs
The present value of stream A is $11,885
The present value of stream B is $27,199
The present value of stream C is $56,221
Add Answer to:
Find the present value of the streams of cash flows shown in
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