PV of Multiple Cash Flows: Ferris, Inc

question 17

Multiple Choice

PV of multiple cash flows: Ferris, Inc., has borrowed from their bank at a rate of 8 percent and will repay the loan with interest over the next five years. Their scheduled payments, starting at the end of the year are as follows-$450,000, $560,000, $750,000, $875,000, and $1,000,000. What is the present value of these payments? (Round to the nearest dollar.)

• A) $2,735,200
• B) $2,615,432
• C) $2431,224
• D) $2,815,885

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Definitions:

Phonological Processing

An auditory processing skill that involves detecting and discriminating differences in speech sounds under conditions of little or no distraction or distortion.

Amygdala Functioning

Pertains to the role of the amygdala, a brain structure involved in emotion regulation, fear processing, and memory.

Autistic Children

Children diagnosed with Autism Spectrum Disorder, characterized by difficulties in social interaction, communication, and by restricted and repetitive behavior.

Mute

Unable to speak, often resulting from congenital deafness, injury, or a psychological condition.