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Viefleur [7K]
3 years ago
8

You are given an investment to analyze. the cash flows from this investment are end of year 1. $19,340 2. $2,280 3. $26,600 4. $

24,240 5. $8,770 what is the present value of this investment if 15 percent per year is the appropriate discount rate?
Business
1 answer:
AleksandrR [38]3 years ago
6 0
PW = FW×(1+i)^-n

PW = $19340×1.15^-1 + $2280×1.15^-2 + $26600×1.15^-3 + $24240×1.15^-4 + $8770×1.15^-5 = $54250.90

hence PW = $54250.90
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brainly.com/question/10276258

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2 years ago
Poe Company is considering the purchase of new equipment costing $86,500. The projected annual cash inflows are $36,700, to be r
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Answer:

Year     Cashflow    [email protected]%      PV

                 $                                  $

0            (86,500)         1           (86,500)

1-4          36,700       3.1699       116,335

                                         NPV   29,835                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

 

Explanation:

In this case, there is need to discount the annual cash inflow at the present value of annuity factor for 4 years, which is 3.1699. Then, we will determine the present value of annual cash inflow by multiplying the annual cash inflow by the annuity factor. The net present value of the equipment is the present value of annual cash inflow minus initial outlay.

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