PV of Multiple Cash Flows: Hassan Ali Has Made an Investment

question 7

Multiple Choice

PV of multiple cash flows: Hassan Ali has made an investment that will pay him $11,455, $16,376, and $19,812 at the end of the next three years. His investment was to fetch him a return of 14 per cent. What is the present value of these cash flows? (Round to the nearest dollar.)

• A) $33,124
• B) $36,022
• C) $41,675
• D) $39,208

---

Definitions:

Law of Averages

The principle stating that over a large number of trials, outcomes will roughly equal the probability of an event occurring.

Web Site

A collection of related web pages under a single domain name, designed to provide information, services, or products over the internet.

Potential Customers

Individuals or entities that are likely to be interested in a company's product or service but have not yet made a purchase.

Parallel Referral Sale

A selling technique where a salesperson gains new prospects through recommendations from existing customers in a similar field or industry.