Question: PROBLEM 3 Consider the following uneven cash flow stream: Year Cash Flow 0 $0 1 $575 2 $650 3 $750 4 $825 5 $850 a.

PROBLEM 3
Consider the following uneven cash flow stream:
Year Cash Flow
0 $0
1 $575
2 $650
3 $750
4 $825
5 $850
a. What is the net present (Year 0) value if the opportunity cost (discount) rate is 8.5 percent?
b. Add an ouflow (or cost) of $1,450 at the outset. What is the present value (or net present value) of the
stream?

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