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Calculate the present value of the cash flows

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Question - Calculate the present value of the cash flows associated with a life insurance policy that you inherited, using a 12 percent interest rate.

1. The life insurance policy offers a payout option of Rs 5,000,000 at the end of each of the next four years.

2. A second option, under the same policy, is to receive Rs 2,450,000 per year, for each of the next 12 years.

3. Identify which option you prefer and describe why you prefer it.

Reference no: EM132717055

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