Homework Answers
Correct answer-----------$50,700
Working
| Net cash flow per year | PVA factor | Present value of cash flows |
| $ 100,000.00 | 4.344 | $ 434,400.00 |
| Less: Initial investment | $ 383,700.00 | |
| Ner cash flow | $ 50,700.00 |
*Initial investment = $100000 x PVA factor@20%
Initial investment = 100000 x 3.837= $383700
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