Question: Using only the information in the accompanying table, answer the questions that follow. a. Determine the present value of the mixed stream of cash flows

Using only the information in the accompanying table, answer the questions that follow.

a. Determine the present value€™ of the mixed stream of cash flows using a 5% discount rates.
b. How much would you be willing to pay for an opportunity to buy this stream, assuming that you can at best earn 5% on your investments?
c. What effect, if any, would a 7% rather than a 5% opportunity cost have on your analysis? (Explainverbally.)

Futurevalue nrerest factot e ir ( C shBew.sliniui iriat 5% Fim Sand..- $ 800 900 1,000 1,500 2,000 1.050 1.102 1.158 1.216 1.276 3

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