An investment will pay you $700 at the end of each of the next 2 years, $600 at the end of year 3, $4500 at the end of year 4, and $250 at the end of year 5. If other investments of equal risk earn 6.5% annually, what should you be willing to pay for this investment? Why ?  Why not?

Answer rating: 100% (QA)

To determine the appropriate price to pay for this investment we need to calculate the present value of the future cash flows using the given discount ... View the full answer