Question: Consider an uneven cash flow stream Year 0 $2000 1 2000 2 0 3 1,500 4 2500 5 4000 What is the present year (0)

Consider an uneven cash flow stream

Year

0 $2000

1 2000

2 0

3 1,500

4 2500

5 4000

What is the present year (0) value of the cash flow stream if the opportunity cost rate is 10%?

What is the future year (5) value of the cash flow stream if the cash flows are invested in an account that pays 10

% annually?

What cash flow today year (0), in lieu of the $2000 cash flow, would be needed to accumulate $20,000 at the end of year 5? Assume the cash flows for years 1 thru 5 remain the same.

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