Consider the streams of income given in the following table: a. Find the present value of each income stream, using a discount rate of 1%, then repeat those calculations using a discount rate of 7%. b. Compare the calculated present values and discuss them in light of the fact that the undiscounted total income amounts to $34,000 in each case. a. The present value of income stream A, using a discount rate of 1% is $ (Round to the nearest cent.) The present value of income stream B, using a discount rate of 1% is $ (Round to the nearest cent.) The present value of income stream A, using a discount rate of 7% is $ (Round to the nearest cent.) The present value of income stream B, using a discount rate of 7% is $. (Round to the nearest cent.) b. Compare the calculated present values and discuss them in light of the fact that the undiscounted total income amounts to $34,000 in each case. (Select the best choice below.) O A. Although the total amount is the same, income stream B has a lower present value because small cash flows occur in early years and are discounted more at a higher interest rate. O B. Although the total amount is the same, income stream B has a lower present value because large cash flows occur in later years and are discounted more at a given interest rate level. O C. Although the total amount is the same, income stream B has a lower present value because the interest rate is assumed to be fixed during the investment period. OD. Although the total amount is the same, income stream B has a lower present value because the number of investment years is limited to only four years. Data Table Income Stream End of Year A B 1 $10,000 $7,000 2 $9,000 $8,000 3 $8,000 $9,000 4 $7,000 $10,000 Total $34,000 $34.000 (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) Click to select your answer(s). Save for Later