Year  
Year Cash Flow
Year 0 (Today) $2,000
Year 1 2,000
Year 2 0
Year 3 1,500
Year 4 2,500
Year 5 4,000
What is the future value (Year 5) of the cash flow stream if the cash flows are invested in an account that pays 10% annually?
Homework Answers
Future value of cash flow can be calculated using the basic time value of money function: FV = PV * (1 + r)n
Now, based on this function,
FV = 2000 * (1 + 10%)5 + 2000 * (1 + 10%)4 + 0 * (1 + 10%)3 + 1500 * (1 + 10%)2 + 2500 * (1 + 10%)1 + 4000 * (1 + 10%)0
FV = 3,221.02 + 2,928.20 + 0 + 1815.00 + 2,750 + 4,000
FV = $14,714.22 --> Answer
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Consider the following cash flows (see the attached Excel sheet) and answer the following questions. Show...
Consider the following cash flows (see the attached Excel sheet)
and answer the following questions.
Show your work in Excel.
a) What is the net present value (NPV) if the opportunity cost
of cost of capital is 10%?
b) Add an outflow of $2000 at time 0 and lower the opportunity
cost of capital to 6%. Now, what is the net present value?
B A Parta) Year Cash Flow $2,000 $2,000 $1,500 $2,500 $4,000 5 Cost of Capit 10% NPV...
Consider the following cash flows (see the attached Excel sheet) and answer the following questions.(see attached...
Consider the following cash
flows (see the attached Excel sheet) and answer the following
questions.(see attached pic) a) What is the net present value (NPV)
if the opportunity cost of cost of capital is 10%? b) Add an
outflow of $2000 at time 0 and lower the opportunity cost of
capital to 6%. Now, what is the net present value?
M N O 1 Parta) 2 Year Cash Flow 0 $ 2,000 1 $ 2,000 2 $ 3 $ 1,500...
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4. Harrison, Inc. is considering two investment opportunities. Each investment costs $7.000 (i.e.. year 0 cash...
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Use Excel to calculate the expected present value of the following cash flows using a 5%...
Use Excel to calculate the expected present value of the
following cash flows using a 5% discount rate? Be prepared to
explain how you calculated your answer.
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Consider the following cash flows (see the attached Excel sheet)
and answer the following questions.
Show your work in Excel.
a) What is the net present value (NPV) if the opportunity cost
of cost of capital is 10%?
b) Add an outflow of $2000 at time 0 and lower the opportunity
cost of capital to 6%. Now, what is the net present value?
B A Parta) Year Cash Flow $2,000 $2,000 $1,500 $2,500 $4,000 5 Cost of Capit 10% NPV...
Consider the following cash
flows (see the attached Excel sheet) and answer the following
questions.(see attached pic) a) What is the net present value (NPV)
if the opportunity cost of cost of capital is 10%? b) Add an
outflow of $2000 at time 0 and lower the opportunity cost of
capital to 6%. Now, what is the net present value?
M N O 1 Parta) 2 Year Cash Flow 0 $ 2,000 1 $ 2,000 2 $ 3 $ 1,500...
Question (2): (4 Marks) 1- An investment pays $400 in one year, X amount of dollars in two years, and $500 in three years. The total present value of all the cash flows (including X) is equal to $1,500. If (i) is 6 percent, what is X? (2 Marks) 2- Calculate the future value of $12,000 invested today for 3 years if your investment pays 8% compounded semiannually. (1.0 Mark) 3. Calculate the present value of $9,000 received 6 years...
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Use Excel to calculate the expected present value of the
following cash flows using a 5% discount rate? Be prepared to
explain how you calculated your answer.
Year 1 Cash Flow Estimates $ 1,500 $ 2,000 $ 2,500 Probabiltiy of Estimate 10% 50% 40% Total Year 2 $ $ $ 3,300 3,600 4,000 15% 40% 45%
Find the Future Value (FV) of the following set of unequal cash flows: Year 1: 1,000; Year 2: 1,500; Year 3: 0; Year 4: 2,500; Year 5: 3,000. Assume a 6% interest rate. Try to solve the problem using both algebra and the cash flow worksheet on the calculator. Select one: O a. $7,017.54 O b. $8,721.08 O c. $10,576.68 O d. $9,210.60 e. $8,322.01
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