Pakistan International Airways has recently conducted a survey on its services and revenues. The surveys show...

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Pakistan International Airways has recently conducted a survey on its services and revenues. The surveys show that there was constant revenue of $ 1,000,000 for the first ten years since 2001 and it reduced with constant rate of $ 100,000 every year for next 10 years (i.e. 2021). PIA wants to calculate what cumulative sum would be equivalent to these revenues at the end of 2021 if the budget had an interest rate of 9.5% compounded annually. Draw cash flow for this scenario. Pakistan International Airways has recently conducted a survey on its services and revenues. The surveys show that there was constant revenue of $ 1,000,000 for the first ten years since 2001 and it reduced with constant rate of $ 100,000 every year for next 10 years (i.e. 2021). PIA wants to calculate what cumulative sum would be equivalent to these revenues at the end of 2021 if the budget had an interest rate of 9.5% compounded annually. Draw cash flow for this scenario.

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Here are the stepbystep workings 1 Cash flows for PIA reve... View the full answer