Answered step by step
Verified Expert Solution
Question
1 Approved Answer
can i get help with this three questions please? What is the present value of the following set of cash flows, discounted at 15.3% per
can i get help with this three questions please?
What is the present value of the following set of cash flows, discounted at 15.3% per year? You work for a pharmaceutical company that has developed a new drug. The patent on the drug will last 17 years. You expect that the drug's profits will be $3 milion in 5 first year and that this amount will grow at a rate of 2% per year for the next 17 years. Once the patent expires, othar pharmaceutical companies will be ablia to procuce the same drug and competition will likely drive profits to zero. What is the present value of the new drug if the interest rate in 10% per yoar? The present value of the new drug is $ million. (Round to threo decimal places.) You work for a pharmaceutical company that has developed a new drug. The patent on the drug will inst 17 years. You expect that the drug's profts will bo $2 milison in ts first year and that this amount will grow at a rate of 5% per year for the next 17 years. Once the patent expires, other pharmaceutical consanies will be abin to produce the same drug and competition will likely drive profits to zero. What is the present value of the new drug if the interest rate is 10% per year? The present value of the now drug is $ milition. (Round to three decimal places.) Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started