Question: All value comes from future cash flows, and making positve net present value decisions is the sign of a good steward of capital and management.

  1. All value comes from future cash flows, and making positve net present value decisions is the sign of a good steward of capital and management.

    Everything is built on those core ideas.

    You have run across an investment opportunity.

    The investment promises to pay out $25,000 in fouryears from today.

    The prevailing discount rate is 9% annually.

    How much would you be willing to approximately pay today for this investment opportunity?

    a.

    Willing to pay today = $15,710.63
    b.

    Willing to pay today = $22,935.78
    c.

    Willing to pay today = $20,000.00
    d.

    Willing to pay today = $17,710.63

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