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Consider the following uneven cash flow stream: Year Cash Flow 0 $0 1 $400 2 $500 3 $750 4 $850 5 $1,000 a. What is
| Consider the following uneven cash flow stream: | ||||||||
| Year | Cash Flow | |||||||
| 0 | $0 | |||||||
| 1 | $400 | |||||||
| 2 | $500 | |||||||
| 3 | $750 | |||||||
| 4 | $850 | |||||||
| 5 | $1,000 | |||||||
| a. What is the present (Year 0) value if the opportunity cost (discount) rate is 9 percent? | ||||||||
| b. Add an ouflow (or cost) of $2,000 at Year 0. What is the present value (or net present value) of the | ||||||||
| stream? | ||||||||
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