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

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 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.)

Opportunity Cost
Opportunity cost is the profit lost when one alternative is selected over another. The Opportunity Cost refers to the expected returns from the second best alternative use of resources that are foregone due to the scarcity of resources such as land,...