VIISA Co. has identified an investment project with the following cash flows: Year 1 2 3 Cash Flow $1,000 960 1,800 If the discount rate is 10 percent, what is the present value of these cash flows? Suppose the discount rate is unchanged, the future value of these cash flows in year 5 is $10,000. All cash flows are unchanged except the cash flows of the third year. What is the change in third year's cash flow?
VIISA Co. has identified an investment project with the following cash flows: Year 1 2 3 Cash Flow $1,000 960 1,800 If the discount rate is 10 percent, what is the present value of these cash flows? Suppose the discount rate is unchanged, the future value of these cash flows in year 5 is $10,000. All cash flows are unchanged except the cash flows of the third year. What is the change in third year's cash flow?
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:VIISA Co. has identified an investment project with the following cash flows:
Year
1
2
3
Cash Flow
$1,000
960
1,800
If the discount rate is 10 percent, what is the present value of these cash flows? Suppose the discount rate is unchanged, the future value of these cash flows
in year 5 is $10,000. All cash flows are unchanged except the cash flows of the third year. What is the change in third year's cash flow?
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