Question

The following is a forecast of net cash thrown off from a business. You require a...

The following is a forecast of net cash thrown off from a business. You require a 12% return on your money. What is the maximum price you would pay for this business. $550 Each year for the next 5 years. What is the purchase price. Please show how you did it in excel so I can do it

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Answer #1

Function Arguments X PV Rate 12% 0.12 Nper 5 5 Pmt -550 -550 Fv 0 Туре 1982.626911 Returns the present value of an investment

Hence, Purchase price is $1,982.63

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