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    Annuities and Cash Flows

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    To find the present value of an uneven series of cash flows, you might find the PVs of the individual cash flows and then sum them. Annuity procedures can never be of use, even if some of the cash flows constitute an annuity (for example, $100 cash for Years 3, 4, 5, and 6), because the entire series is not an annuity. Is this statement true or false? Explain.

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    Solution Preview

    False. The present value of an annuity (even cash flow) can be calculated by summing the present values for each year even though one can ...

    Solution Summary

    Annunities and cash flows are examined.