Using a time line The financial manager at Starbuck Industries is considering an investment that...
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Using a time line The financial manager at Starbuck Industries is considering an investment that requires an initial outlay of $20,000 and is expected to produce cash inflows of $1,000 at the end of year 1, $5,000 at the end of years 2 and 3. $14,000 at the end of year 4. $7.000 at the end of year 5 and $7.000 at the end of year 6. a. Select the time line option that represents the cash flows associated with Starbuck Industries' proposed investment b. Which of the approaches-future value or present value-do financial managers rely on most often for decision making? Why? a. Which of the following time lines correctly represents the cash flows associated with Starbuck Industries proposed investment? Select the best answer below.) OA. $20,000 $1,000 $5,000 $5,000 $14.000 57.000 57,000 0 1 2 4 5 6 OB. $7,000 $7.000 514,000 $5,000 $5,000 $1,000 -$20,000 0 1 2 4 5 6 C. - $20,000 $1,000 55.000 $5,000 $14.000 57.000 57,000 0 1 2 6 OD. $20,000 - 51,000 - 55.000 - $5,000 - $14.000 - 57,000 - $7,000 0 6
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