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You are given three investment alternatives to analyze. The cash flows from these three investments are as follows: Investment End of Year A B C
You are given three investment alternatives to analyze. The cash flows from these three investments are as follows:
Investment |
| ||||||||
End of Year | A | B | C | ||||||
1 | $ | 1,000 | $ | 1,000 | $ | 4,000 | |||
2 | 2,000 | 1,000 | 4,000 | ||||||
3 | 3,000 | 1,000 | (4,000) | ||||||
4 | (4,000) | 1,000 | (4,000) | ||||||
5 | 4,000 | 5,000 | 14,000 |
What is the present value of each of these three investments if the appropriate discount rate is 13 percent?
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