Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. relationship between future value and present valu

Relationship between future value and present value-Mixed stream Using the information in the accompanying table,...

80.2K

Verified Solution

Question

Finance

image

Relationship between future value and present value-Mixed stream Using the information in the accompanying table, answer the questions that follow. a. Determine the present value of the mixed stream of cash flows using a 5% discount rate. b. Suppose you had a lump sum equal to your answer in part a on hand today. If you invested this sum for 5 years and earned a 5% return each year, how much would you have after 5 years? c. Determine the future value 5 years from now of the mixed stream, using a 5% interest rate. Compare your answer here to your answer in part b. d. How much would you be willing to pay for an opportunity to buy this stream, assuming that you can at best earn 5% on your investments? a. The present value of the mixed stream of cash flows using a 5% discount rate is $ (Round to the nearest cent.) Data Table (Click on the icon here in order to copy the contents of the data table below into a spreadsheet.) Year (t) 0 1 2 3 4 5 Cash flow $0 $800 $800 $1,000 $1,400 $1,900

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

Roller coaster ride: A roller coaster is being designed that will accommodate 60 riders. The maximum...

Statistics
Q

1A) The proportions of defective parts produced by two machines were compared, and the following data...

Statistics
Q

On admission, a 12-lead ECG has been ordered. Which of the following options best describes the...

Medical Sciences
Q

Why was it difficult for slaves to have families? And how did Slave owners use family...

Psychology
Q

7 Consider a charged hemispherical shell shown in figure Indicate the directions not magnitude of...

Physics
Q

Two equal and opposite forces are applied tangentially to a uniform disc of mass M...

Physics
Q

A gyroscope spins with its tip on the ground and is spinning with negligible frictional...

Physics
Q

The sequenceis given.Part A: Assuming the pattern continues, list the next four terms in the...

Basic Math
Q

3 Evaluate the following integrals a 10 pts x x 1 e dr

Calculus
Q

What do you think of the estate and gift taxes? Are they fair? Should they...

Accounting
Q

Exercise 15-5 Sales-type lease: lessor; balance sheet and income statement effects [LO15-3] On June 30,...

Accounting
Q

Case 7.1 a-d Cases NDAND INCREMENTAL ANALYSIS. Sarah Drogo, president of Storage, Inc. CASE...

Accounting