 The first stream is $450 per year for 9 years and begins 5 years from...
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 The first stream is $450 per year for 9 years and begins 5 years from today  The second stream begins 7 years from today with the first cash flow being $400, and with each successive cash flow growing at 6% ; and there are a total of 6 cash flows in this second stream.  The third stream has two single cash flowsthe first is $8,000 occurring 6 years from today and the second is $13,000 occurring 6 years after the first cash flow. Assume that all cash flows are either discounted or compounded (depending on what is being asked) at 10%. (5 points) What is the present value (today at time 0) of the first cash flow stream? (5 points) What if the present value (today at time 0) of the second cash flow stream? (5 points) What is the present value (today at time 0) of the third stream of cash flows? (4 points) if the cash flows from each of the three streams of cash flows are deposited in an account (when each is received) in which they compound at 10%, how much would be in the account 31 years from today?
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Answer rating: 100% (QA)
To calculate the present value of each cash flow stream we will use the formula for calculating the present value of an annuity PV C 1 1 r n r where PV is the present value C is the cash flow r is the ... View the full answer
Related Book For
Income Tax Fundamentals 2019
ISBN: 9781337703062
37th Edition
Authors: Gerald E. Whittenburg, Steven Gill
Posted Date:
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