Required information As indicated, some of the cash flows are expressed in future (then-current) dollars and others in current-value (today's) dollars. Use a real interest rate of 10% per year and an inflation rate of 6% per year. Cash Flow, $ 19,000 38,500 22,000 28,500 Expressed As Today's Then-current Then-current Today's Year 3 4 7 NOTE: This is a multi-part question. Once an answer is submitted, you will be unable to return to this part. Find the present worth of the estimated cash flows.

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
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Required information
As indicated, some of the cash flows are expressed in future (then-current)
dollars and others in current-value (today's) dollars. Use a real interest rate of
10% per year and an inflation rate of 6% per year.
Expressed As
Today's
Then-current
Then-current
Today's
Year
Cash Flow, $
19,000
38,500
22,000
28,500
3
7
NOTE: This is a multi-part question. Once an answer is submitted, you will be
unable to return to this part.
Find the present worth of the estimated cash flows.
The present worth of the estimated cash flows is $84,316
Transcribed Image Text:Required information As indicated, some of the cash flows are expressed in future (then-current) dollars and others in current-value (today's) dollars. Use a real interest rate of 10% per year and an inflation rate of 6% per year. Expressed As Today's Then-current Then-current Today's Year Cash Flow, $ 19,000 38,500 22,000 28,500 3 7 NOTE: This is a multi-part question. Once an answer is submitted, you will be unable to return to this part. Find the present worth of the estimated cash flows. The present worth of the estimated cash flows is $84,316
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