4) What is the present value of receiving (the sum of) $30,000 next year, $35,000 in...

4) What is the present value of receiving (the sum of) $30,000 next year, $35,000 in two years, and $40,000 in three years if the interest rate is 4%?

Solutions

Expert Solution

Ans $ 96765.48

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

1	30000	1/((1+4%)^1)	0.961538	28,846.15
2	35000	1/((1+4%)^2)	0.924556	32,359.47
3	40000	1/((1+4%)^3)	0.888996	35,559.85
		PV	96,765.48

jeff jeffy answered 1 year ago

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