Question
Relationship between future value and present value-Mixed stream Using the information in the accompanying table, answer the questions that follow. a. Determine the present
Relationship between future value and present value-Mixed stream Using the information in the accompanying table, answer the questions that follow. a. Determine the present value of the mixed stream of cash flows using a 6% discount rate. b. Suppose you had a lump sum equal to your answer in part a on hand today. If you invested this sum for 5 years and earned a 6% return each year, how much would you have after 5 years? c. Determine the future value 5 years from now of the mixed stream, using a 6% interest rate. Compare your answer here to your answer in part b. d. How much would you be willing to pay for an opportunity to buy this stream, assuming that you can at best earn 6% on your investments? Data table a. The pre cent.) xample (Click on the icon here in order to copy the contents of the data table below into a spreadsheet.) 012345 Year (t) 0 Cash flow $0 $800 2 $800 $1,200 $1,600 $1,900 - X
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