You are given the following cash flows

Finance Dec 25, 2020

You are given the following cash flows. What is the present value (t = 0) if the discount rate is 6 percent? (PV of uneven cash flow) 0 5 6 Periods + + - $1000 2,000 2,000 2,000 500 -2,000 1 2 69 3 0

Expert Solution

a)	(b)	(.c)	(d)=b*c
Year	Cashflow	PV Factor @6%	PV
1	$1,000.00	0.9434	$943.40
2	$2,000.00	0.8900	$1,779.99
3	$2,000.00	0.8396	$1,679.24
4	$2,000.00	0.7921	$1,584.19
5	$500.00	0.7473	$373.63
6	-$2,000.00	0.7050	-$1,409.92
		total	$4,950.52
	PV(at t=0) =$4950.52

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