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Assume that you are nearing graduation and have applied for a job with a local bank. As part of the bank's evaluation process, you have
Assume that you are nearing graduation and have applied for a job with a local bank. As part of the bank's evaluation process, you have been asked to take an examination that covers several financial analysis techniques. The first section of the test addresses discounted cash flow analysis. See how you would do by answering the following questions.
- What is the total present value of the following uneven cash flow stream? The appropriate interest rate is 12%, compounded annually.
Yr | CF |
1 | 200 |
2 | 100 |
3 | 500 |
4 | 400 |
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