Question

For the stream of end of period cash flow shown below find the future worth at the end of the period of the last non zer...

For the stream of end of period cash flow shown below find the future worth at the end of the period of the last non zero cash flow using an interest rate of 7.0% per period

Period

1

2

3 4

5

6

7

Cash Flow

-500

-200

100

400

700

1000

1300

0 0
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Answer #1

Ans : Future value = $ 3,793

Year Future value factor =(1+r)^n Future value factor Cash flows Future value of cash flows
1 (1+7%)^4 1.31079601 100 131
2 (1+7%)^3 1.225043 400 490
3 (1+7%)^2 1.1449 700 801
4 (1+7%)^1 1.07 1000 1070
5 1 1 1300 1300
Future value of cash inflows 3793
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