Question
The Purple Lion Beverage Company expects the following cash flows from its manufacturing plant in Palau over the next four years: Annual Cash Flows Year
The Purple Lion Beverage Company expects the following cash flows from its manufacturing plant in Palau over the next four years:
| Annual Cash Flows | |||
|---|---|---|---|
| Year 1 | Year 2 | Year 3 | Year 4 |
| $250,000 | $37,500 | $180,000 | $300,000 |
The CFO of the company believes that an appropriate annual interest rate on this investment is 6.5%. What is the present value of this uneven cash flow stream, rounded to the nearest whole dollar?
$467,500
$1,475,000
$1,692,500
$650,014
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The Bank Analysts Handbook Money Risk And Conjuring Tricks
Authors: Stephen M. Frost
1st Edition
0470091185, 978-0470091180
