What is the present value of the following cash-flow stream if the interest rate is 4%?...

What is the present value of the following cash-flow stream if the interest rate is 4%? You receive 650 at the end of first year, 900 at the end of second year, and 260 at the end of third year. (4% is annual interest rate and given annual compounding) [Please round your answer to the nearest whole number]

Expert Solution

Ans $ 1688

Year	Project Cash Flows (i)	DF@ 4%	DF@ 4% (ii)	PV of Project ( (i) * (ii) )

1	650	1/((1+4%)^1)	0.961538	625
2	900	1/((1+4%)^2)	0.924556	832
3	260	1/((1+4%)^3)	0.888996	231
		PV	1,688

jeff jeffy answered 2 years ago

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