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1) Which of the following cashflows do you most prefer using a discount rate of 10%? Rank them. Show all supporting calculations. Cashflow A: receive
1) Which of the following cashflows do you most prefer using a discount rate of 10%? Rank them. Show all supporting calculations. Cashflow A: receive $10 every year, for 10 years, with the first payment next year. Cashflow B: receive $40 today and then receive $70 in five years. Cashflow C: receive $70 today and then receive $30 in five years. 2) Now, rank them using a discount rate of 1%. Do the results change? Why?
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