An investment is expected to earn you $3,868 in one year, $4, 312 in two years and 4,474 in three years. If you can earn 17.68% annually, how much is this investment worth today. Hint: you need to find the present value of each cash flow individually, then add them up. Enter your answer as a POSITIVE number and rounded to two decimal places.
An investment is expected to earn you $3,868 in one year, $4, 312 in two years and 4,474 in three years. If you can earn 17.68% annually, how much is this investment worth today. Hint: you need to find the present value of each cash flow individually, then add them up. Enter your answer as a POSITIVE number and rounded to two decimal places.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
None
Transcribed Image Text:An investment is expected to earn you $3,868 in one year, $4, 312 in two years
and 4,474 in three years. If you can earn 17.68% annually, how much is this
investment worth today. Hint: you need to find the present value of each cash flow
individually, then add them up. Enter your answer as a POSITIVE number and
rounded to two decimal places.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Recommended textbooks for you
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education