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
![Help finish the next exercise:
A delivery company is evaluating an investment to purchase vehicles. This is expected to generate a
return of $9988.00 one year from now $16,230.00 two years from now and $21,107.00 three years
from now. The required rate of return is 10%. Caloulate the discoonted cash flow.
We already know that:
• The Present Value of the Cash Flow 2 is $13,413.22 ond,
• The Present Value of the Cash Flow 3 is $15,858.00
Find the Present Value of the Cash Flow 1 and, using this and the previous information, calculate the
discounted cash flow.
Note: Write you answer rounded to two decimal places, Type just the number, do not type the S sign
For example, if your answer is $25,500.55 type only. 25500.55
Answer](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F41c6b717-4101-4adb-8046-94dd9e0d4a23%2F31713bcd-66aa-44aa-b15c-59dc4f5845b4%2Ftq4tll_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Help finish the next exercise:
A delivery company is evaluating an investment to purchase vehicles. This is expected to generate a
return of $9988.00 one year from now $16,230.00 two years from now and $21,107.00 three years
from now. The required rate of return is 10%. Caloulate the discoonted cash flow.
We already know that:
• The Present Value of the Cash Flow 2 is $13,413.22 ond,
• The Present Value of the Cash Flow 3 is $15,858.00
Find the Present Value of the Cash Flow 1 and, using this and the previous information, calculate the
discounted cash flow.
Note: Write you answer rounded to two decimal places, Type just the number, do not type the S sign
For example, if your answer is $25,500.55 type only. 25500.55
Answer
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