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The table below contains cash flows for five mixed streams (i.e., unequal cash flows). YEAR EXAMPLE A- CASH FLOW EXAMPLE B- CASH FLOW EXAMPLE C-
The table below contains cash flows for five mixed streams (i.e., unequal cash flows).
YEAR | EXAMPLE A- CASH FLOW | EXAMPLE B- CASH FLOW | EXAMPLE C- CASH FLOW | EXAMPLE D- CASH FLOW | EXAMPLE E- CASH FLOW |
1 | 40,000 | 20,000 | -2,000 | 10,000 | 10,000 |
2 | 30,000 | 30,000 | 3,000 | 5,000 | 8,000 |
3 | 20,000 | 40,000 | 4,000 | 5,000 | 8,000 |
4 | 10,000 | -50,000 | 6,000 | 5,000 | 8,000 |
5 | 5,000 | 5,000 | 8,000 | ||
6 | 5,000 | 8,000 | |||
7 | 7,000 | 8,000 | |||
8 | 9,000 |
For each of the five mixed streams, calculate the present value three times once using each of the following interest rates:
Rate #1 5% per year, compounded annually
Rate #2 7% per year, compounded annually
Rate #3 10% per year, compounded annually
NOTE that the cash flows are annual and the compounding is also annual.
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