You are valuing an investment that will pay you nothing the first two years, $5,000 the...

You are valuing an investment that will pay you nothing the first two years, $5,000 the third year, $7,000 the fourth year, $11,000 the fifth year, and $17,000 the sixth year (all payments are at the end of each year). What is the value of the investment to you now if the appropriate annual discount rate is 10.00%?

Expert Solution

ANS $ 24963.86

Year	Project Cash Flows (i)	DF@ 10% (ii)	PV of Project A ( (i) * (ii) )
0	0	1	-
1	0	0.909	-
2	0	0.826	-
3	5000	0.751	3,756.57
4	7000	0.683	4,781.09
5	11000	0.621	6,830.13
6	17000	0.564	9,596.06
	CASH INFLOW		24,963.86

jeff jeffy answered 1 year ago

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