Question

Use the following set of cash flows for the questions below:

Table A
Year	Cash Flow
1	$5,973
2	$18,662
3	$61,839
4	$66,528
5	$68,052
6	$73,559

           
2.

1. Using the cash flows in Table A, determine the present value of the cash flow stream at the following discount rates: 3%, 8%, 12%, 18%, and 22%. (Use a data table to complete these calculations. (please show how to do in excel, having a hard time figuring out how to use the data table to find answers.)

Answer 1

Present value of cash flow is calculated as follows:
Year	Cash flow	Discount factor @ 3%	Present value
a	b	c=1.03^-a	d=b*c
1	$            5,973	0.970874	$       5,799.03
2	$         18,662	0.942596	$     17,590.72
3	$         61,839	0.915142	$     56,591.45
4	$         66,528	0.888487	$     59,109.27
5	$         68,052	0.862609	$     58,702.25
6	$         73,559	0.837484	$     61,604.50
	Total		$ 2,59,397.22
Year	Cash flow	Discount factor @ 8%	Present value
a	b	c=1.08^-a	d=b*c
1	$            5,973	0.925926	$       5,530.56
2	$         18,662	0.857339	$     15,999.66
3	$         61,839	0.793832	$     49,089.79
4	$         66,528	0.73503	$     48,900.07
5	$         68,052	0.680583	$     46,315.05
6	$         73,559	0.63017	$     46,354.65
	Total		$ 2,12,189.77
Year	Cash flow	Discount factor @ 12%	Present value
a	b	c=1.12^-a	d=b*c
1	$            5,973	0.892857	$       5,333.04
2	$         18,662	0.797194	$     14,877.23
3	$         61,839	0.71178	$     44,015.78
4	$         66,528	0.635518	$     42,279.75
5	$         68,052	0.567427	$     38,614.53
6	$         73,559	0.506631	$     37,267.28
	Total		$ 1,82,387.60
Year	Cash flow	Discount factor @ 18%	Present value
a	b	c=1.18^-a	d=b*c
1	$            5,973	0.847458	$       5,061.86
2	$         18,662	0.718184	$     13,402.76
3	$         61,839	0.608631	$     37,637.12
4	$         66,528	0.515789	$     34,314.40
5	$         68,052	0.437109	$     29,746.16
6	$         73,559	0.370432	$     27,248.57
	Total		$ 1,47,410.88
Year	Cash flow	Discount factor @ 22%	Present value
a	b	c=1.22^-a	d=b*c
1	$            5,973	0.819672	$       4,895.90
2	$         18,662	0.671862	$     12,538.30
3	$         61,839	0.550707	$     34,055.16
4	$         66,528	0.451399	$     30,030.68
5	$         68,052	0.369999	$     25,179.19
6	$         73,559	0.303278	$     22,308.83
	Total		$ 1,29,008.06