P4A.13 Consider the streams of income given in the following table.

a. Find the present value of each income stream, using a 15% discount rate.

b. Compare the calculated present values and discuss them in light of the fact that the undiscounted total income amounts to $10,000 in each case. End of Year 1 2 3 4 Total Income Stream B A $ 4,000 $ 1,000 3,000 2,000 2,000 3,000 1,000 $10,000 4,000 $10,000