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Determining the present value of the stream

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Reference no: EM132664111

Consider the following uneven cash flow stream:

Year Cash Flow

0 $0

1 250

2 400

3 500

4 600

5 600

a. What is the present (Year 0) value if the opportunity cost (discount) rate is 10 percent?

b. Add an outflow (or cost) of $1,000 at Year 0. What is the present value (or net present value) of the stream?

Reference no: EM132664111

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