Question: How do I calculate the How do I calculate the real cash flow for year 2, 3, 4, 5. Which formula would I use? Assume

How do I calculate the

How do I calculate the real cash flow for year 2, 3, 4, 5. Which formula would I use?

Assume that the real interest rate is 3% per year, and inflation is expected to be constant at 2% per year.

Year Nominal cash flow Real cash flow

0 -100,000 -100,000

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