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Consider the following stream of cash flows. The interest rate is 10%. 0 1 2 3 4 5 6 7 100 100 100 200 0
Consider the following stream of cash flows. The interest rate is 10%.
0 1 2 3 4 5 6 7
100 100 100 200 0 300 300 300
a) What is the value at time 0 of the cash flow stream?
b) What is the value of the cash flow stream at time 4?
c) What time 4 cash flow would make the time 0 value equal to 1,000?
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