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Correct Answer: $990,150 Jennifer So that is the present-day value of expected cash flow 3 years from now? Blaise Bouschard Yes, Monster expects a 9.5%
Correct Answer: $990,150 Jennifer So that is the present-day value of expected cash flow 3 years from now? Blaise Bouschard Yes, Monster expects a 9.5% annual return on their investments, so we must discount the future cash flows by 9.5% for every year in the future they occur. What is the present value of all future cash flows? Note: do not include value of Year O cash flow. Enter a response then click Submit below $ Submit Canning Machine 3 Monster Beverage is considering purchasing a new canning machine. This machine costs $3,500,000 up front. Required return = 9.5% Year 0 1 2 3 4 5 Cash Flow $-3,500,000 $1,000,000 $1,200,000 $1,300,000 $900,000 $1,000,000 Discounted Cash Flow $-3,500,000 $913,242 $1,000,813 $990,150 $626, 017 $635, 228
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