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The following two cash flows Cash Flow (A) and Cash Flow (B) are economically equivalent. The effective interest rate is 10% per period. Please follow
The following two cash flows Cash Flow (A) and Cash Flow (B) are economically equivalent. The effective interest rate is 10% per period. Please follow the questions to find out the unknown X. Cash Flow (A) A-$2,000 2 56 7 8 9 Cash Flow (B) $5,000 X X/3 X/3 X/3 1 S 6 8 2 7 0 9 1 1) The present equivalent value PA of Cash Flow (A) is ii) iii) $15,909 $11,990 $11,518 $15,118 iv) 2) Cash Flow (B) can be decomposed into basic components. i) w 7 3 2 4
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