Question
(Present value of annuities and complex cash flows) You are given three investment alternatives to analyze. The cash flows from these three investments are as
(Present value of annuities and complex cash flows)
You are given three investment alternatives to analyze. The cash flows from these three investments are as follows:
| Investment Alternatives | ||||||
| End of Year | A | B | C | |||
| 1 | $ | 19,000 | $ | 19,000 | ||
| 2 | 19,000 | |||||
| 3 | 19,000 | |||||
| 4 | 19,000 | |||||
| 5 | 19,000 | $ | 19,000 | |||
| 6 | 19,000 | 95,000 | ||||
| 7 | 19,000 | |||||
| 8 | 19,000 | |||||
| 9 | 19,000 | |||||
| 10 | 19,000 | 19,000 | ||||
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Assuming an annual discount rate of 24 percent, find the present value of each investment.
a.What is the present value of investment A at an annual discount rate of 24 percent?
$(Round to the nearest cent.)
b.What is the present value of investment B at an annual discount rate of 24 percent?
$
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A Handbook Of Mutual Fund Investing
Authors: Barry G Dolgin
1st Edition
1456489704, 978-1456489700
