Question
Use Excels NPV (not PV) command to determine the present value of the following mixed-set of cash flows. Youll pay $350 immediately (i.e. a negative
Use Excels NPV (not PV) command to determine the present value of the following mixed-set of cash flows. Youll pay $350 immediately (i.e. a negative cash flow). Thereafter, at the end of the 7th year youll receive a single payment of $425. Thereafter, once again, youll receive nothing for a while. Then 11 years from today, youll begin to receive payments from an annuity stream. The first payment will be $235. The last payment will be received 17 years from today. The payments that comprise the annuity stream are all of the same magnitude (g = 0). Using an effective annual discount rate (EAR) of 3.80%, determine the present value of the entire set of cash flows.
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