(Present value of an uneven stream of payments) You are given three investment alternatives to analyze. The cash flows from these three investments are as follows: 1 End of Year A $ 1,000 Investment B C $1,000 $ 5,000 2 2,000 1,000 5,000 3 3,000 1,000 (5,000) 4 (4,000) 1,000 (5,000) 5 4,000 5,000 15,000 (Click on the icon in order to copy its contents into a spreadsheet.) What is the present value of each of these three investments if the appropriate discount rate is 14 percent?
(Present value of an uneven stream of payments) You are given three investment alternatives to analyze. The cash flows from these three investments are as follows: 1 End of Year A $ 1,000 Investment B C $1,000 $ 5,000 2 2,000 1,000 5,000 3 3,000 1,000 (5,000) 4 (4,000) 1,000 (5,000) 5 4,000 5,000 15,000 (Click on the icon in order to copy its contents into a spreadsheet.) What is the present value of each of these three investments if the appropriate discount rate is 14 percent?
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
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Transcribed Image Text:(Present value of an uneven stream of payments) You are given three investment alternatives to analyze. The cash flows from these three investments are as follows:
1
End of Year
A
$ 1,000
Investment
B
C
$1,000
$
5,000
2
2,000
1,000
5,000
3
3,000
1,000
(5,000)
4
(4,000)
1,000
(5,000)
5
4,000
5,000
15,000
(Click on the icon in order to copy its contents into a spreadsheet.)
What is the present value of each of these three investments if the appropriate discount rate is 14 percent?
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