Find the present value of the following stream of cash flows assuming that the firm's cost is 14% and that these amounts are received at the end of each year.

Year Amount
1 - 5 $20,000/year
6 - 10 $35,000/year

Solution Preview

Note: the abbreviations have the following meanings

PVIF= Present Value Interest Factor
PVIFA= Present Value Interest Factor for an Annuity

They can be read from tables or calculated using the following equations
PVIF( n, r%)= =1/(1+r%)^n
PVIFA( n, r%)= =[1-1/(1+r%)^n]/r%

Find the present value of the following stream of cash flows assuming that the firm's cost is 14% and that these amounts are received at the end of each ...

Solution Summary

Calculates Present Value of a stream of cash flows.

See the attached file.
Relationship between future value and presentvalue-Mixed stream
Using only the information in the accompanying table, answer the questions that follow.
a. Determine the presentvalue of the mixed stream of cashflows using a 5% discount rate.
b. How much would you be willing to pay for an oppor

Please help answer the following problems.
A. Find the presentvalues of the following cash flow streams at 8% compounded annually.
0 1 2 3 4 5
------------------------------------------------
Stream A $0 $100 $400 $400 $400 $300
Stream B $0 $300 $400 $400

What is the presentvalue of a cash flow stream of $1,000.00 per year annually for 15 years that then grows at 4 percent per year forever when the discount rate is 13 percent?

Suppose you just inherited an gold mine. This gold mine is believed to have three years worth of gold deposit. Here is how much income this gold mine is projected to bring you each year for the next three years:
Year 1: $49,000,000
Year 2: $61,000,000
Year 3: $85,000,000
Compute the presentvalue of this stream of income

I need to find the PV of the cash flow streams @ 8% compounded annually. and then (B). is 0 % compounded annually.
Uneven cash flow stream.
A. Find the presentvalues of the following cash flow streams at 8 percent, compounded annually.
0 1 2 3 4 5
__________________________________________________
$0 $100

At the end of 2005, Uma Corporation was considering undertaking a major long-term project in an effort to remain competitive in its industry. The production and sales departments determined the potential annual cash flow savings that could accrue to he firm if it acts soon. Specifically, they estimate that a mixed stream of fu

Question 3 (TVM) (15 marks)
Consider the following stream of cashflows:
where the payments of X start one year from today and last for 10 years; and the payments of Y start in 11 years from now and last forever. The interest rate is 4%.
(a) If X = $100 and Y = $200, what is the presentvalue of this stream? (4 marks)
(b

What is the rate of return on an investment of $16,278 if the company expects to receive $3,000 per year for the next 10 years _______
18 percent, 13 percent, 8 percent, or 3 percent
I believe the answer isn't given - please advise answer & show work - thanks!!!