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    Present Value of a stream of cash flows

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    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

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    https://brainmass.com/business/annuity/present-value-of-a-stream-of-cash-flows-220872

    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.

    $2.19

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