Consider another set of net cash flows: Please include the numbers do no put it on an excel spreadsheet. Simplified version please. Thanks!

YearCash Flow ($)

0 2,000

1 2,000

20

3 1,500

4 2,500

5 4,000

a. What is the net present value of the stream if the opportunity cost of capital is

10 percent?

b. What is the value of the stream at the end of year 5 if the cash flows are in-

vested in an account that pays 10 percent annually?

c. What cash flow today (time 0), in lieu of the $2,000 cash flow, would be needed

to accumulate $20,000 at the end of year 5? (Assume that the cash flows for

years 1 through 5 remain the same.)