Question
You are considering two investments that will generate the following end of year cash flows: Year Cash Flow A Cash Flow B 1 $ 2,000.00
You are considering two investments that will generate the following end of year cash flows:
| Year | Cash Flow A | Cash Flow B |
| 1 | $ 2,000.00 | $ 8,000.00 |
| 2 | $ 4,000.00 | $ 6,000.00 |
| 3 | $ 6,000.00 | $ 4,000.00 |
| 4 | $ 8,000.00 | $ 2,000.00 |
- If your compound rate is 18% what is the future value of each investment at the end of 4 years?
- If your discount rate is 18% what is the maximum price you would be willing to pay for each investment?
Please show work.
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AS Accounting For AQA
Authors: David Cox,Michael Fardon
2nd Edition
1905777140, 978-1905777143
