#4 Part 4 The Capital Budgeting Process 4. You will receive $6,800 three years from now....

Question

Question

#4

Answer 1

Answer #1

4.

a.Present value of inflows=cash inflow*Present value of discounting factor(rate%,time period)

=$6800/1.1

=$6181.82(Approx).

b.Present value of inflows=cash inflow*Present value of discounting factor(rate%,time period)

=$6181.82/1.1

=$5619.83(Approx).

c.Present value of inflows=cash inflow*Present value of discounting factor(rate%,time period)

=$5619.83/1.1

=$5108.94(Approx).

d.PV=$6600/(1+0.1)^3

=$6600/1.1^3

=$6600*0.7513148

=$4958.68(Approx).

Answer 2

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