Global steel prices have a year-over-year inflationary rate increase of 12.4 percent. Tube Fab purchased $700,000 of a particular carbon steel during the year just ended right now, and they intend to purchase the same quantity at the end of each of the next 5 years. Tube Fab earns a real rate of 16 percent on their money.

 

The following is the cash flow for Then- current rate analysis. Determine the then-current amounts they will pay for steel at the end of each of the next 5 years and fill in the correct cash flow below. Also, determine the constant value amounts they will pay for steel at the end of each of the next 5 years and fill in the correct cash flow below

 

 

EOY	Then-Current	Constant Value Amounts
0	$700,000	$700,000
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