Ch 05/06: Homework Problems - Interest Rates and Time Value Parti PV = op CE Many financial decisions require the analysis of uneven, or nonconstant, cash flows. Common stock dividends typically increase over time, and inve capital equipment almost always generate uneven cash flows. The term cash flow (CF) denotes ueron cash flows, while payment (PMT) designates cash flows coming at regular intervals. The present value of an uneven cash flow stream is the sum of the PVs of the Individual cash flows. The equation is: CF (1+1) tu: (1+1) Similarly, the future value of an uneven cash flow stream is the sum of the FVs of the individual cash flows. Many calculators have an NFV key that lets yo FV. However, if your calculator doesn't have a net future value (NPV) key, you can calculate the NPV as follows: NFV - NPV *(1 + 1) One can also find the Interest rate of the uneven cash flow stream with a financial calculator and solving for the internal rate of ten (A) using the IR Quantitative Problem: You own a security with the cash flows shown below. a + 0 1 3 0 610 370 230 340 If you require an annual return of 12%, what is the present value of this cash flow stream? Do not round intermediate calculations. Round your answer to cent $ Grade It Now Save & Continue