okmarks Windo Help SAM 3100 Online Spring 20172018 Homework

okmarks Windo Help SAM 3100 Online Spring 2017-2018 Homework: Chapter 4 Homework Score: 0 of 2 pts P 4-8 (similar to) Abby Netf & 1 1/00/18 854 PM 8of17(7complete) Hw Scores 254%, 533 of 21 pts You have just received a windfall from an investment you made in a friend\'s business She will be paying you $49,415 at the and of this yoar, $98 830 at the and of next ye\" and$148245-nth-ond of the year\"her thotonee years tomtoday, The rterostrano s 45%per year. a What is the present value o your windf b.what is he Mrs value of your wind inthree years (ntho d ofthe last paymen a What is the present value of your windal? estion 8 (02 uestion 12 (o estion 16 (o Enter your answer in the answer box and then click Check Anwer Clear All Copyright 2018 Peason Education

Solution

Future value:

If only the last payment taken into account, the value on end of 3rd year equals the last payment= 148245

If the last two payment are invested at the given interest rate, then the future value will be:

Year	Cash flow	Future value factor	Future value
1	49,415	0.92593	45,754.63
2	98,830	0.85734	84,730.80
3	1,48,245	0.79383	1,17,681.66
	Total present value	2,48,167.09