Question
In: Finance
Problem 5-18 Uneven cash flow stream Find the present values of the following cash flow streams...
Problem 5-18
Uneven cash flow stream
- Find the present values of the following cash flow streams at a
3% discount rate. Round your answers to the nearest cent.
0 1 2 3 4 5 Stream A $0 $100 $450 $450 $450 $300 Stream B $0 $300 $450 $450 $450 $100 Stream A $
Stream B $
- What are the PVs of the streams at a 0% discount rate?
Stream A $
Stream B $
Solutions
Expert Solution
a.Stream A
Net present value is calculated using a financial calculator by inputting the below:
- Press the CF button.
- CF0= -0
- Cash flow for each year should be entered.
- Press Enter and down arrow after inputting each cash flow.
- After entering the last cash flow cash flow, press the NPV button and enter the interest rate of 3%.
- Press enter after that. Press the down arrow and CPT buttons to get the net present value.
The present value of the cash flows is $1,591.67.
Stream B
Net present value is calculated using a financial calculator by inputting the below:
- Press the CF button.
- CF0= -0
- Cash flow for each year should be entered.
- Press Enter and down arrow after inputting each cash flow.
- After entering the last cash flow cash flow, press the NPV button and enter the interest rate of 3%.
- Press enter after that. Press the down arrow and CPT buttons to get the net present value.
The present value of the cash flows is $1,613.32.
b. Stream A
Net present value is calculated using a financial calculator by inputting the below:
- Press the CF button.
- CF0= -0
- Cash flow for each year should be entered.
- Press Enter and down arrow after inputting each cash flow.
- After entering the last cash flow cash flow, press the NPV button and enter the interest rate of 0%.
- Press enter after that. Press the down arrow and CPT buttons to get the net present value.
The present value of the cash flows is $1,750.
Stream B
Net present value is calculated using a financial calculator by inputting the below:
- Press the CF button.
- CF0= -0
- Cash flow for each year should be entered.
- Press Enter and down arrow after inputting each cash flow.
- After entering the last cash flow cash flow, press the NPV button and enter the interest rate of 0%.
- Press enter after that. Press the down arrow and CPT buttons to get the net present value.
The present value of the cash flows is $1,750.
jeff jeffy answered 2 years agoRelated Solutions
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a.)Find the present values of the following cash flow streams at
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2
3
4
5
Stream A
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$250
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Stream A $ ________
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UNEVEN CASH FLOW STREAM Find the present values of the following cash flow streams at a...
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0
1
2
3
4
5
Stream A
$0
$150
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$400
$300
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1
2
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Stream A
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$400
$400
$300
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Problem 4-14 Uneven Cash Flow Stream Find the present values of the following cash flow streams....
Problem 4-14
Uneven Cash Flow Stream
Find the present values of the following cash flow streams. The
appropriate interest rate is 6%. Round your answers to the nearest
cent. (Hint: It is fairly easy to work this problem
dealing with the individual cash flows. However, if you have a
financial calculator, read the section of the manual that describes
how to enter cash flows such as the ones in this problem. This will
take a little time, but the investment...
Uneven Cash Flow Stream Find the present values of the following cash flow streams. The appropriate...
Uneven Cash Flow Stream
Find the present values of the following cash flow streams. The
appropriate interest rate is 10%. (Hint: It is fairly easy
to work this problem dealing with the individual cash flows.
However, if you have a financial calculator, read the section of
the manual that describes how to enter cash flows such as the ones
in this problem. This will take a little time, but the investment
will pay huge dividends throughout the course. Note that,...
Uneven Cash Flow Stream Find the present values of the following cash flow streams. The appropriate...
Uneven Cash Flow Stream
Find the present values of the following cash flow streams. The
appropriate interest rate is 6%. (Hint: It is fairly easy
to work this problem dealing with the individual cash flows.
However, if you have a financial calculator, read the section of
the manual that describes how to enter cash flows such as the ones
in this problem. This will take a little time, but the investment
will pay huge dividends throughout the course. Note that,...
Uneven Cash Flow Stream Find the present values of the following cash flow streams. The appropriate...
Uneven Cash Flow Stream
Find the present values of the following cash flow streams. The
appropriate interest rate is 6%. Round your answers to the nearest
cent. (Hint: It is fairly easy to work this problem
dealing with the individual cash flows. However, if you have a
financial calculator, read the section of the manual that describes
how to enter cash flows such as the ones in this problem. This will
take a little time, but the investment will pay...
eBook Problem 4-14 Uneven Cash Flow Stream Find the present values of the following cash flow...
eBook Problem 4-14 Uneven Cash Flow Stream Find the present
values of the following cash flow streams. The appropriate interest
rate is 6%. Round your answers to the nearest cent. (Hint: It is
fairly easy to work this problem dealing with the individual cash
flows. However, if you have a financial calculator, read the
section of the manual that describes how to enter cash flows such
as the ones in this problem. This will take a little time, but the...
eBook Problem 4-14 Uneven Cash Flow Stream Find the present values of the following cash flow...
eBook Problem 4-14 Uneven Cash Flow Stream Find the present
values of the following cash flow streams. The appropriate interest
rate is 6%. Round your answers to the nearest cent. (Hint: It is
fairly easy to work this problem dealing with the individual cash
flows. However, if you have a financial calculator, read the
section of the manual that describes how to enter cash flows such
as the ones in this problem. This will take a little time, but the...
Find the present values of the following cash flow streams at a 5% discount rate. Do...
Find the present values of the following cash flow streams at a
5% discount rate. Do not round intermediate calculations. Round
your answers to the nearest cent.
0
1
2
3
4
5
Stream A
$0
$150
$450
$450
$450
$300
Stream B
$0
$300
$450
$450
$450
$150
Stream A: $
Stream B: $
What are the PVs of the streams at a 0% discount rate? Round
your answers to the nearest dollar.
Stream A: $
Stream B: $
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