Discounting Cash Flows Determine the Present Value of the Following Cash Flows Discounted

question 65

Essay

Discounting cash flows
Determine the present value of the following cash flows discounted at an annual rate of 10%:
(a)$96,000 to be received five years from today (the present value of $1 at a 10% compound interest rate for five years is 0.621): $________
(b)$37,000 to be received annually for five years (the present value of $1 at 10% received annually for five years is 3.791): $________
(c)$58,000 to be received annually for six years,with an additional $16,000 salvage value to be received at the end of the sixth year (the present value of $1 at 10% received annually for six years is 4.355,and the present value of $1 due six years hence at 10% is 0.564): $________

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Definitions:

IQ

represents a score derived from standardized assessments designed to measure human intelligence and cognitive abilities.

Poor Nutrition

A state of receiving inadequate nutrients from the diet, leading to health problems.

Correlation

A statistical measure that describes the extent to which two variables change together, but does not imply cause-and-effect.

IQ Scores

Numeric values derived from standardized assessments intended to measure human intelligence and cognitive abilities.