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
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
Section: Chapter Questions
Problem 1PS
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Question
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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