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  3. year cash flow 0 $0 1 $250 2 $400 3 $500 4 $600 5

Year Cash Flow 0 $0 1 $250 2 $400 3 $500 4 $600 5 $600 What is the present (Year 0) value...

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Finance


Year Cash Flow
0 $0
1 $250
2 $400
3 $500
4 $600
5 $600

What is the present (Year 0) value if the opportunity cost(discount) rate is 10 percent?
Add an outflow (or cost) of $1,000 at Year 0.
What is the present value (or net present value) of thestream?

Answer & Explanation Solved by verified expert
3.8 Ratings (491 Votes)
Here the cash outflows per year are not uniform or equal so it is not an annuity For calculating the present valuewe will use    See Answer
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Transcribed Image Text

Year Cash Flow0 $01 $2502 $4003 $5004 $6005 $600What is the present (Year 0) value if the opportunity cost(discount) rate is 10 percent?Add an outflow (or cost) of $1,000 at Year 0.What is the present value (or net present value) of thestream?

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