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(1 pt) You deposit $200 in an Ideal Bank with rate r 0.04 compounded annually After 1 year you withdraw $C. After 2 years you
(1 pt) You deposit $200 in an Ideal Bank with rate r 0.04 compounded annually After 1 year you withdraw $C. After 2 years you withdraw $C Find the value of C such that the net present value of the cash flow stream, is zero. Let To, T1, 72 represent the cash flow stream relative to your wallet. Then X0-1-200 Type C as C, leaving off the dollar sign. In computing the present value of the cash at different times, the discount factors are d(0,0) = The present values of the cash at the different times, are PVEro The net present value of the cash flow is , 2 1 106.24 , T2 = 1 d(0.1 ) = , d(0,2) = PV[n] = The net future value (after 2 years) of the cash flow is The value of C such that the NPV of the cash flow is zero, is C=
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