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Assume the appropriate discount rate for the following cash flows is 9.5 percent

ID: 2751141 • Letter: A

Question

Assume the appropriate discount rate for the following cash flows is 9.5 percent.

What is the present value of the cash flows? (Enter rounded answer as directed, but do not use rounded numbers in intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)

Present Value:

Assume the appropriate discount rate for the following cash flows is 9.5 percent.

Required:

What is the present value of the cash flows? (Enter rounded answer as directed, but do not use rounded numbers in intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)

Present Value:

Cash Flow Year 2 4 $1,750 1,650 1,350 1,150

Explanation / Answer

Year Cashflows (A) PVF@9.5% Present value 1 $      1,750 0.913 $             1,598.17 2 $      1,650 0.834 $             1,376.12 3 $      1,350 0.762 $             1,028.23 4 $      1,150 0.696 $                 799.91 Present value $             4,802.43

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