Sum of their present value
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The company's new project will generate the following cash flows at the end of each of the stated years:
Year 2 543;
Year 4 219;
Year 7 879.
If these cash flows are discounted at 12%, what is the sum of their present value?
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Solution Summary
The solution explains how to calculate the sum of the present value of the given cash flows.
Solution Preview
The formula for present value is Amount/(1+rate)^n where rate is the discounting rate = 12% here ...
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