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An investment promises the following cash flow stream: $1,000 at Time 0;$, at the end of...

An investment promises the following cash flow stream: $1,000 at Time 0;$, at the end of year 1(or at t=1); $3,000 at the end of year 2; and $5,000 at the end of year 3. At a discount rate of 7.3%, what is the present value of the flow stream?


$2000 at the end of year 1
0 0
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Answer #1
Year Cashflows PVF at 7.30% Present Value
0 1000 1 1000
1 2000 0.931966 1863.933
2 3000 0.868561 2605.684
3 5000 0.80947 4047.351
Present value of cashflows 9516.97
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