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Solve for all the parts and I will rate your answer with a thumbs up. Q1-Consider the following cash flows: Period 1 Amount of Cash
Solve for all the parts and I will rate your answer with a thumbs up.
Q1-Consider the following cash flows: Period 1 Amount of Cash Flow @ the End Period $10,000 $25,000 $15,000 2 3 1. Suppose there is no interest charged. Determine the PV and the FV of the above cash flows. (5 pts.) 2. Suppose interest rate is a small negative rate. What would be the relation between the PV and the FV of the above cash flows. (5 pts.) 3. Prepare an Excel sheet in order to examine the effect of interest rate increase/decrease on the above cash flows. Hint: you may want to vary interest rate in the range [.02, .1] in increments of 1%. (10 pts.) 4. What are your conclusions regarding the impact of interest rates on PV and FV? (5 pts.)Step by Step Solution
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