Tom is comparing two investments. Investment A pays an annual $10000 stream of cash flows that last for 25 years. Each year the investment pays out at the beginning of the year. Investment B pays a similar $10000 stream of cash flows, however, the payments are made at the end of the year. Also, investment B does not make a payment in year 17. Both investments pay a 4.25% rate of return. 

What is the difference in present value between the two investments?

Answer rating: 100% (QA)

To find the difference in present value between the two investments Investment A and Investment B we ... View the full answer