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Green Tree Corporation is expecting to receive $0.5 million at the end of Year 1, $0.25...

Green Tree Corporation is expecting to receive $0.5 million at the end of Year 1, $0.25 million at the end of Year 2, $0.375 million at the end of Year 3, $0.40 million at the end of Year 4, and -$0.25 million at the end of Year 5 (a payout amount). How much do these cash flows worth today, if the interest rate that can be earned is 5.5 percent per year? (I recommend finding the present value of each one separately and then adding the values.)

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Answer #1
Year Cashflows PVF at 5.50% Present Value
1 500000 0.947867 473933.6
2 250000 0.898452 224613.1
3 375000 0.851614 319355.1
4 400000 0.807217 322886.7
5 -250000 0.765134 -191284
Present worth 1149505
Answer is $ 1149505
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