problem 2.1,d

Economics 173B - Corporate Finance Prof. Garey Ramey Study Problems I Winter '2017-18 Problem 2.1. Calculate the current market values of the following cash flows at the given occs. a. $80,000 received at year 6, OCC is 11%. b. $120,000 received at year 15, OCC is . b 3 c. $40,000 received at year 2, OCC is 6%. 5 6 d. Calculate the current market value an O C f the portfolio consisting of the assets in parts a, b and c. 105-9 Problem 2.2. Suppose you expect to receive $35,000 in one year, $30,000 in two years and $25,000 in three years, but you must pay $40,000 in four years. The OCC for this cash flow stream is 9%. a. Calculate the current market value of the cash flow stream. I b. Forecast the market value of this cash flow stream at year 2. Problem 2.3. Suppose you expect to receive $150,000 in one year and $200,000 in two years. The OCC for this cash flow stream is 17%. a. Calculate the current market value of the cash flow stream. b. Suppose the cash flow stream is delayed by three years. Calculate the value of the delayed stream. ) c. Suppose instead that the cash flow stream is delayed by 10 years. Calculate the value of the delayed stream in this case. O Problem 2.4. Calculate the current market values of the following cash flow streams at the given OCCs. a. $20,000 received at years 1 through 15, OCC is 5%. 201 b. $100,000 received at years 1 through 4, OCC is 15%. c. $65,000 received now and at years 1 through 20, OCC is 6%. d. Calculate the current market value and OCC of the portfolio consisting of the assets Darts a, b and c. 'em 2.5. Calculate the current market values of the following cash flo at