Question

You are given an investment to analyze. The cash flows from this investment are

End of year

1. $2,118
2. $5,800
3. $567
4. $2,383
5. $1,167

What is the future value of this investment at the end of year five if 14.58 percent per year is the appropriate interest (discount) rate?

Round the answer to two decimal places.

Answer 1

Future Value of uneven cashflow can be calculated as

CF1*(1+r)^n-1 + CF2*(1+r)^n-2 + ...... + CFn

2118*1.1458^4 + 5800*1.1458^3 + ​​​​​​​567*1.1458^2 + ​​​​​​​2383*1.1458^1 + 1167*1.1458^0

2118*1.72359518291 + ​​​​​​​5800*1.50427228391 + ​​​​​​​567*1.31285764 + ​​​​​​​2383*1.1458 + 1167

3650.5745974+8724.77924668+744.39028188+2730.4414+1167

17017.19