Question
Question 2 (10 marks) This question relates to material covered in the Topics 1 to 3. This question addresses the 5th and 6th subject learning
Question 2 (10 marks)
This question relates to material covered in the Topics 1 to 3. This question addresses the 5th and 6th subject learning outcomes.
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
Below are the expected cash flows and interest rates for the next nine years. Cash flows will occur at the end of the nominated years.
Cash Flows | Interest Rates | |||
Year 0 | Years 1 - 5 | 2.5% | ||
Year 1 | +$ 5,000 | |||
Year 2 | ||||
Year 3 | +$ 5,000 | |||
Year 4 | -$ 2,500 | |||
Year 5 | +$ 2,700 | |||
Year 6 | Years 6 8 | 5% | ||
Year 7 | ||||
Year 8 | $ 8,000 | |||
Year 9 | Years 9 - 10 | 6% | ||
Year 10 | $20,000 |
(a) Using the Table function within MS Word, draw a timeline (as modelled at the start of the question) showing the above cash flows and interest rates (2.5 marks)
(b) What will be the accumulated value of all these cash flows at each of the following times (7.5 marks):
Time 0
Time 6
Time 10
Example only: % 5 5 6.5 Cfi $1000 $1000 $1000 YEAR 0 1 2 3 Example only: % 5 5 6.5 Cfi $1000 $1000 $1000 YEAR 0 1 2 3Step by Step Solution
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