Revision as of 22:24, 17 November 2023 by Admin (Created page with "'''Solution: C.''' The first cash flow of 60,000 at time 3 earns 2400 in interest for a time 4 receipt of 62,400. Combined with the final payment, the investment returns 122,400 at time 4. The present value is 122,400(1.05)<sup>-4</sup> = 100, 699. The net present value is 699. {{soacopyright | 2023 }}")
Exercise
ABy Admin
Nov 17'23
Answer
Solution: C.
The first cash flow of 60,000 at time 3 earns 2400 in interest for a time 4 receipt of 62,400. Combined with the final payment, the investment returns 122,400 at time 4. The present value is 122,400(1.05)-4 = 100, 699. The net present value is 699.
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