What is the present value of the following cash flow stream at a rate of 15.0%? Years: 0 1 2 3 4 CFs: $0 $1,500 $3,000 $4,500 $6,000 ​ Select one: a. $10,261 b. $12,453 c. $12,154 d. $10,859 e. $9,962

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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What is the present value of the following cash flow stream at a rate of 15.0%?
 
 

Years:

0

1

2

3

4

 

CFs:

$0

$1,500

$3,000

$4,500

$6,000

Select one:
a.
$10,261
b.
$12,453
c.
$12,154
d.
$10,859
e.
$9,962
 
Expert Solution
Step 1

Present value of cash flows means value as on date of all the future cash flows that are to be received. This is calculated by discounting future cash flows with a given percentage.

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