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Your consulting firm will produce cash flows of $200,000 this year, and you expect cash flow thereafter to keep pace with any increase in the
Your consulting firm will produce cash flows of $200,000 this year, and you expect cash flow thereafter to keep pace with any increase in the general level of prices. The interest rate currently is 5%, and you anticipate inflation of about 1%. a. What is the present value of your firm's cash flows for years 1 through 5? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Present value b. How would your answer to (a) change if you anticipated no growth in cash flow? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Present value
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