Moving Cash Flows What Is the Value in Year 15

question 120

Multiple Choice

Moving Cash Flows What is the value in year 15 of a $600 cash flow made in year 3 when the interest rates are 4 percent?

• A)$374.76
• B)$888.00
• C)$960.62
• D)$1,080.57

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Definitions:

Available-For-Sale

A classification for financial assets indicating they are neither held for trading purposes nor intended to be held to maturity, and therefore can be sold.

Equity Securities

Financial instruments representing ownership interest in a company, such as stocks, which provide rights to dividends and capital gains.

Goodwill

An intangible asset that arises when a company acquires another company for a price higher than the fair value of its net tangible assets.

Merger Transaction

A financial operation in which two or more companies combine to form a new entity or one company absorbs another.