If the discount rate is 7 percent, what is the future value of the cash flows in
ID: 2740845 • Letter: I
Question
If the discount rate is 7 percent, what is the future value of the cash flows in year 4? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))
If the discount rate is 12 percent, what is the future value of the cash flows in year 4? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))
If the discount rate is 23 percent, what is the future value of the cash flows in year 4? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))
Toadies, Inc., has identified an investment project with the following cash flows.Explanation / Answer
a Year Cash Flow Future Value Future Value Calculation 1 $1,500.00 $1,837.56 = 1500 * 1.07^3 2 $1,620.00 $1,854.74 = 1620 * 1.07^2 3 $1,705.00 $1,824.35 = 1705 * 1.07 4 $1,755.00 $1,755.00 = 1755 $7,271.65 b Year Cash Flow Future Value Future Value Calculation 1 $1,500.00 $2,107.39 = 1500 * 1.12^3 2 $1,620.00 $2,032.13 = 1620 * 1.12^2 3 $1,705.00 $1,909.60 = 1705 * 1.12 4 $1,755.00 $1,755.00 = 1755 $7,804.12 c Year Cash Flow Future Value Future Value Calculation 1 $1,500.00 $2,791.30 = 1500 * 1.23^3 2 $1,620.00 $2,450.90 = 1620 * 1.23^2 3 $1,705.00 $2,097.15 = 1705 * 1.23 4 $1,755.00 $1,755.00 = 1755 $9,094.35
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