A. The time line below illustrates a series of annual cash flows. Assume a discount rate (interest rate, required rate of return) of 6% per year, compounded annually. Calculate the present value (PV) of this mixed stream.

NOTE: the timeline is marked in annual periods.

0 1 2 3 4 5 6 years

|---------------- |--------------- |---------------- |----------------- |---------------- |---------------- |

500 200 - 300 0 200 500

B. The time line below illustrates a series of semiannual cash flows. Assume a discount rate (interest rate, required rate of return) of 3% per year, compounded semiannually. Calculate the present value (PV) of this mixed stream.

NOTE: the timeline is marked in half year periods.

0 1 2 3 4 5 6 pds

|---------------- |--------------- |---------------- |----------------- |---------------- |---------------- |

200 200 - 200 0 200 500

C. The time line below illustrates a series of quarterly cash flows. Assume a discount rate (interest rate, required rate of return) of 6% per year, compounded quarterly. Calculate the present value (PV) of this mixed stream.

NOTE: the timeline is marked in quarterly periods.

0 1 2 3 4 5 6 pds

|---------------- |--------------- |---------------- |----------------- |---------------- |---------------- |

450 450 450 0 450 450