Following is an example of a cash flow timeline developed using the Table Function within MS Word.

Please use this example as a means to develop a similar timeline in your answer to the following question.

Example only:

%

5%

6.5%

Year

0

1

2

3

CFi

$0

$1,000

$1,000

$1,000

Below are the expected cash flows and interest rates expected from an investment overthe next ten years.

Cash flows will occur at the end of the nominated years.

Cash Flows

Interest Rates

Year₀

Years 1 - 2

8%

Year₁

Year₂

+$ 6,500

Year₃

+$ 1,500

Years 3 - 8

6%

Year₄

Year₅

Year₆

-$ 2,500

Year₇

Year₈

Year₉

+$ 10,000

Years 9 - 10

7%

Year₁₀

i.

Using the Table function within MS Word, draw a time line showing the above cash flows and interest rates (following the example above) (6 marks).

ii.

What will be thevalueofallthese cash flows at each of the following times:

-Time₁

-Time₅

_-Time₁₀