An investment of $245,000 will pay $76,200, $88,800, $78,400, and $65,320 respectively in years 1, 2, 3,
Fantastic news! We've Found the answer you've been seeking!
Question:
An investment of $245,000 will pay $76,200, $88,800, $78,400, and $65,320 respectively in years 1, 2, 3, and 4 and an annual constant payment of $12,000 indefinitely thereafter. The market interest rate is of 15%.
a) Calculate the total present value of the cash flows generated from the investment.
(15 marks)
b) Based on the total present value calculated in part (a) against the initial investment of $245,000. Is this a good investment.
Related Book For
Posted Date: