Use the Present Value of $1 table to determine the present value of $1 received one year from now. Assume an 8% interest rate. Use the same table to find the present value of $1 received two years from now. Continue this process for a total of five years. Round to three decimal places. (Click the icon to view Present Value of $1 table.) Read the requirements Requirements - X O 1. What is the total present value of the cash flows received over the five-year period? 2. Could you characterize this stream of cash flows as an annuity? Why or why not? 3. Use the Present Value of Ordinary Annuity of $1 table to determine the present value of the same stream of cash flows. Compare your results to your answer to Requirement 1. 4. Explain your findings Print Done Reference Periods 1% 2% 3% 4% 5% 6% 7% Period 1 0.990 0.980 0.971 0.962 0.952 0.943 0.935 0.926 Period 2 0.980 0.961 0.943 0.925 0.907 0.890 0.873 0.857 Period 3 0.971 0.942 0.915 0.889 0.864 0.840 0.816 0.794 Period 4 0.961 0.924 0.888 0.855 0.823 0.792 0.763 Period 5 0.951 0.906 0.863 0.822 0.784 0.747 0.713 Present Value of $1 8% 9% 10% 12% 14% 15% 16% 18% 20% 0.917 0.909 0.893 0.877 0.870 0.862 0.847 0.833 0.842 0.826 0.797 0.769 0.756 0.743 0.718 0.694 0.772 0.751 0.712 0.675 0.658 0.641 0.609 0.579 0.735 0.708 0.683 0.636 0.592 0.572 0.552 0.516 0.482 0.681 0.650 0.621 0.567 0.519 0.497 0.476 0.437 0.402 Period 6 0.942 0.888 0.837 0.790 0.746 0.705 0.666 0.630 Period 7 0.933 0.871 0.813 0.760 0.711 0.665 0.623 0.583 Period 8 0.923 0.853 0.789 0.731 0.677 0.627 0.582 0.540 Period 9 Period 10 0.905 0.820 0.744 0.676 0.614 0.914 0.837 0.766 0.703 0.645 0.592 0.544 0.500 0.460 0.424 0.361 0.558 0.508 0.463 0.422 0.386 0.322 Period 11 Period 12 0.887 0.788 0.701 0.625 0.557 0.896 0.804 0.722 0.650 0.585 0.527 0.475 0.429 0.497 0.444 0.397 Period 13 0.879 0.773 0.681 0.601 0.530 0.469 0.415 0.368 0.870 0.758 0.661 0.577 Period 14 Period 15 0.861 0.743 0.642 0.555 0.481 0.417 0.505 0.442 0.388 0.340 0.362 0.315 Period 16 Period 17 0.844 0.714 0.853 0.728 0.623 0.534 0.458 0.394 0.339 0.292 0.605 0.513 0.436 0.371 0.317 0.270 Period 18 0.836 0.700 Period 19 0.828 0.686 0.570 0.475 0.587 0.494 0.416 0.350 0.296 0.396 0.331 0.277 Period 20 0.820 0.673 0.554 0.456 Period 21 0.811 0.660 0.538 0.439 0.359 0.294 0.377 0.312 0.258 0.400 0.376 0.354 0.314 0.279 0,327 0.305 0.266 0.233 0.308 0.284 0.263 0.225 0.194 0.270 0.247 0.227 0.191 0.162 0.388 0.350 0.287 0.237 0.215 0.195 0.162 0.135 0.356 0.319 0.257 0.208 0.187 0.168 0.137 0.112 0.326 0.290 0.229 0.182 0.163 0.145 0.116 0.093 0.299 0.263 0.205 0.160 0.141 0.125 0.099 0.078 0.275 0.239 0.183 0.140 0.123 0.108 0.084 0.065 0.252 0.218 0.163 0.123 0.107 0.093 0.071 0.054 0.231 0.198 0.146 0.108 0.093 0.080 0.060 0.045 0.250 0.212 0.180 0.130 0.095 0.081 0.069 0.051 0.038 0.232 0.194 0.164 0.116 0.083 0.070 0.060 0.043 0.031 0.215 0.178 0.149 0.104 0.073 0.061 0.051 0.037 0.026 0.596 0.564 0.507 0.456 0.432 0.410 0.370 0.335 0.547 0.513 0.452 0.502 0.467 0.404 0.351 0.242 0.199 0.164 0.135 0.093 Period 22 0.803 0.647 0.522 0.422 0.342 0.278 0.226 0.184 0.150 0.123 0.083 0.064 0.053 0.056 0.044 0.031 0.022 0.046 0.038 0.026 0.018 Period 23 0.795 0.634 Period 24 0.788 0.622 Period 25 0.780 0.610 Period 26 0.772 0.598 0.507 0.406 0.326 0.262 0.211 0.170 0.138 0.112 0.074 0.049 0.040 0.033 0.022 0.015 0.492 0.390 0.310 0.247 0.197 0.158 0.126 0.102 0.066 0.043 0.035 0.028 0.019 0.013 0.478 0.375 0.295 0.233 0.184 0.464 0.361 0.281 0.220 0.172 0.135 0.106 0.084 0.053 0.033 Period 27 0.764 0.586 0.450 0.347 0.268 Period 28 0.757 0.574 0.437 0.333 0.255 0.207 0.161 0.125 0.196 0.150 0.116 0.098 0.076 0.047 0.090 0.069 0.042 0.146 0.116 0.092 0.059 0.038 0.030 0.024 0.016 0.010 0.026 0.021 0.014 0.009 0.029 0.023 0.018 0.011 0.007 0.026 0.020 0.016 0.010 0.006 Period 29 0.749 0,563 0.424 0.321 0.243 0.185 0.141 0.107 Period 30 0.742 0.552 0.412 0.308 0.231 0.174 0.131 0.099 Period 40 0.672 0.453 0,307 0.208 0.142 0.097 0.067 0.046 Period 50 0.608 0.372 0.228 0.141 0.087 0.054 0.034 0.021 0.013 0.009 0.003 0.082 0.063 0.037 0.075 0.057 0.033 0.032 0.022 0.011 0.022 0.017 0.014 0.008 0.005 0.020 0.015 0.012 0.007 0.004 0.005 0.004 0.003 0.001 0.001 0.001 0.001 0.001 Print Done Reference Periods 1% 2% 3% 4% 5% 6% 7% Period 1 0.990 0.980 0.971 0.962 0.952 0.943 0.935 0.926 Period 2 0.980 0.961 0.943 0.925 0.907 0.890 0.873 0.857 Period 3 0.971 0.942 0.915 0.889 0.864 0.840 0.816 0.794 Period 4 0.961 0.924 0.888 0.855 0.823 0.792 0.763 Period 5 0.951 0.906 0.863 0.822 0.784 0.747 0.713 Present Value of $1 8% 9% 10% 12% 14% 15% 16% 18% 20% 0.917 0.909 0.893 0.877 0.870 0.862 0.847 0.833 0.842 0.826 0.797 0.769 0.756 0.743 0.718 0.694 0.772 0.751 0.712 0.675 0.658 0.641 0.609 0.579 0.735 0.708 0.683 0.636 0.592 0.572 0.552 0.516 0.482 0.681 0.650 0.621 0.567 0.519 0.497 0.476 0.437 0.402 Period 6 0.942 0.888 0.837 0.790 0.746 0.705 0.666 0.630 Period 7 0.933 0.871 0.813 0.760 0.711 0.665 0.623 0.583 Period 8 0.923 0.853 0.789 0.731 0.677 0.627 0.582 0.540 Period 9 Period 10 0.905 0.820 0.744 0.676 0.614 0.914 0.837 0.766 0.703 0.645 0.592 0.544 0.500 0.460 0.424 0.361 0.558 0.508 0.463 0.422 0.386 0.322 Period 11 Period 12 0.887 0.788 0.701 0.625 0.557 0.896 0.804 0.722 0.650 0.585 0.527 0.475 0.429 0.497 0.444 0.397 Period 13 0.879 0.773 0.681 0.601 0.530 0.469 0.415 0.368 0.870 0.758 0.661 0.577 Period 14 Period 15 0.861 0.743 0.642 0.555 0.481 0.417 0.505 0.442 0.388 0.340 0.362 0.315 Period 16 Period 17 0.844 0.714 0.853 0.728 0.623 0.534 0.458 0.394 0.339 0.292 0.605 0.513 0.436 0.371 0.317 0.270 Period 18 0.836 0.700 Period 19 0.828 0.686 0.570 0.475 0.587 0.494 0.416 0.350 0.296 0.396 0.331 0.277 Period 20 0.820 0.673 0.554 0.456 Period 21 0.811 0.660 0.538 0.439 0.359 0.294 0.377 0.312 0.258 0.400 0.376 0.354 0.314 0.279 0,327 0.305 0.266 0.233 0.308 0.284 0.263 0.225 0.194 0.270 0.247 0.227 0.191 0.162 0.388 0.350 0.287 0.237 0.215 0.195 0.162 0.135 0.356 0.319 0.257 0.208 0.187 0.168 0.137 0.112 0.326 0.290 0.229 0.182 0.163 0.145 0.116 0.093 0.299 0.263 0.205 0.160 0.141 0.125 0.099 0.078 0.275 0.239 0.183 0.140 0.123 0.108 0.084 0.065 0.252 0.218 0.163 0.123 0.107 0.093 0.071 0.054 0.231 0.198 0.146 0.108 0.093 0.080 0.060 0.045 0.250 0.212 0.180 0.130 0.095 0.081 0.069 0.051 0.038 0.232 0.194 0.164 0.116 0.083 0.070 0.060 0.043 0.031 0.215 0.178 0.149 0.104 0.073 0.061 0.051 0.037 0.026 0.596 0.564 0.507 0.456 0.432 0.410 0.370 0.335 0.547 0.513 0.452 0.502 0.467 0.404 0.351 0.242 0.199 0.164 0.135 0.093 Period 22 0.803 0.647 0.522 0.422 0.342 0.278 0.226 0.184 0.150 0.123 0.083 0.064 0.053 0.056 0.044 0.031 0.022 0.046 0.038 0.026 0.018 Period 23 0.795 0.634 Period 24 0.788 0.622 Period 25 0.780 0.610 Period 26 0.772 0.598 0.507 0.406 0.326 0.262 0.211 0.170 0.138 0.112 0.074 0.049 0.040 0.033 0.022 0.015 0.492 0.390 0.310 0.247 0.197 0.158 0.126 0.102 0.066 0.043 0.035 0.028 0.019 0.013 0.478 0.375 0.295 0.233 0.184 0.464 0.361 0.281 0.220 0.172 0.135 0.106 0.084 0.053 0.033 Period 27 0.764 0.586 0.450 0.347 0.268 Period 28 0.757 0.574 0.437 0.333 0.255 0.207 0.161 0.125 0.196 0.150 0.116 0.098 0.076 0.047 0.090 0.069 0.042 0.146 0.116 0.092 0.059 0.038 0.030 0.024 0.016 0.010 0.026 0.021 0.014 0.009 0.029 0.023 0.018 0.011 0.007 0.026 0.020 0.016 0.010 0.006 Period 29 0.749 0,563 0.424 0.321 0.243 0.185 0.141 0.107 Period 30 0.742 0.552 0.412 0.308 0.231 0.174 0.131 0.099 Period 40 0.672 0.453 0,307 0.208 0.142 0.097 0.067 0.046 Period 50 0.608 0.372 0.228 0.141 0.087 0.054 0.034 0.021 0.013 0.009 0.003 0.082 0.063 0.037 0.075 0.057 0.033 0.032 0.022 0.011 0.022 0.017 0.014 0.008 0.005 0.020 0.015 0.012 0.007 0.004 0.005 0.004 0.003 0.001 0.001 0.001 0.001 0.001 Print Done