4-15 If the opportunity cost rate is 7.5 percent, what is the present value of an investment that pays $500 at the end of this year, $400 at the end of the next year, and $300 at the end of the following year? What is the present value if the payments are made at the beginning of each year?
4-15 If the opportunity cost rate is 7.5 percent, what is the present value of an investment that pays $500 at the end of this year, $400 at the end of the next year, and $300 at the end of the following year? What is the present value if the payments are made at the beginning of each year?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:4-15
If the opportunity cost rate is 7.5 percent, what is the present value of an
investment that pays $500 at the end of this year, $400 at the end of the next year, and
$300 at the end of the following year? What is the present value if the payments are
made at the beginning of each year?
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