150 CHAPTER 4 EQUIVALENCE FOR REPEATED CASH FLOWs For diagra

150 CHAPTER 4: EQUIVALENCE FOR REPEATED CASH FLOWs For diagrams (a) to (d), C of the cash flows. 4-53 3000 200 175 2000 150 1000 125 0-3_4 0-23 (b) i = 10% 3000 2000 1000 02345 (c) 1-10%

Solution

Req a: Year cash flows PVf @ 10% Present value 0 0 1 0 1 125 0.909091 113.6364 2 150 0.826446 123.9669 3 175 0.751315 131.4801 4 200 0.683013 136.6027 Present value 505.68 Req b: Year cash flows PVf @ 10% Present value 0 0 1 0 1 3000 0.909091 2727.273 2 2000 0.826446 1652.893 3 1000 0.751315 751.3148 Present value of Inflows 5131.48 Req c: Year cash flows PVf @ 10% Present value 0 0 1 0 1 0 0.909091 0 2 0 0.826446 0 3 1000 0.751315 751.3148 4 2000 0.683013 1366.027 5 3000 0.620921 1862.764 Present value of inflows 3980.11