Compute the present value, P, for the following cash flows.
A cash flow diagram has points from 0 to 9. 4, 6, and 8 points up to 500; 5, 7, and 9 points up to 1200. The heights of the arrows that point to 1200 are taller than those that point to 500. The text below the diagram is I = 10 percent. 

Select one: 

a. $2727 

b. $2121 

c. $2929 

d. $2525 $500

Transcribed Image Text:

$500 $1200 $500 456 $1200 $1200 1 $500 9 $500 $1200 $500 456 $1200 $1200 1 $500 9

Answer rating: 100% (QA)

Solution Present value 500 10104 1200 1 010 5 500 1 0106 1200 1 010 500 ... View the full answer