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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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Solution Summary

Calculates Present Value of a stream of cash flows.

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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 ...

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