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    Calculating present value of a stream of cash flows

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    What would be the present value of receiving $100, $200, $300, at the end of 1, 2, 3 years respectively at 8% annual compound interest.

    Do not use MS Excel or present value tables.

    Please provide formulas/calculations for your response.

    © BrainMass Inc. brainmass.com December 24, 2021, 9:08 pm ad1c9bdddf
    https://brainmass.com/business/the-time-value-of-money/calculating-present-value-stream-cash-flows-347243

    SOLUTION This solution is FREE courtesy of BrainMass!

    Solution:

    Present Value of a single future cash flow =Future value/(1+interest rate)^no. of period

    Present Value of multiple cash flows= sum of PV's of all future cash flows
    =100/(1+8%)^1+200/(1+8%)^2+300/(1+8%)^3
    =$502.21

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    © BrainMass Inc. brainmass.com December 24, 2021, 9:08 pm ad1c9bdddf>
    https://brainmass.com/business/the-time-value-of-money/calculating-present-value-stream-cash-flows-347243

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