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You expect to deposit the following cash flows at the end of years 1 through 5, $1,000; $4,000; $9,000; $5,000; and $2,000 respectively. Alternatively, you
You expect to deposit the following cash flows at the end of years 1 through 5, $1,000; $4,000; $9,000; $5,000; and $2,000 respectively. Alternatively, you could deposit a single amount today at the beginning of year 1 (end of year 0). How large does the single deposit need to be today if you can earn 10% compounded annually? Hint: the present value today (t=0) is identical to the single cash flow amount.
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