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FV = 50.01 1. 013) + 300 = $15 Evaluate * The timeline helps us organize our work so that we get the number of
FV = 50.01 1. 013) + 300 = $15 Evaluate * The timeline helps us organize our work so that we get the number of periods of compounding* correct . The first cash flow will have I year of compounding , but the second cash flow will be deposited at the end of period I , so it receives no compounding . 4 . Editor's Note : In several previous problems we used a financial calculator to solve & time value* of money problem . Problems could be solved quickly and easily by manipulating the N. ITY . PV, PMIT , and FV Keys . In each of these problems there was a series of payments , of equal amount , over time , i.e., an annuity . All you had to do to input this series was enter the payment [PMI'T'S and the number of payment IN) . Many financial analysis problems involve a series of equal payments , but others involve a series of unequal payments . A financial calculator can be used to evaluate an unequal series of cash flows (using the cash flow ( CF ) Key', but the process is cumbersome because each cash flow must be entered individually . I urge each student to study the Chapter 4 Appendix : " Using* a Financial Calculator," as well as instructional materials that are produced by the manufacturers* of the financial calculator .* Here we will solve a problem with uneven cash flows mathematically and with a financial calculator .* Plan . It is wonderful that you will receive this windfall from your investment in your friend's business . Since the cash flow payments to you are of different amounts and paid over 3 years , there are different ways in which you can think about how much money you are receiving . PV = 10,000` 1, 20, 000, 30, 000 1.0135\\ "1 .035 2 1.0135* = 9052 + 18. 570 + 27. 058 = 55. 390
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