Present value and multiple cash flowsinvestment x offers to

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Present Value and Multiple Cash Flows.

Investment X offers to pay you $7,000 per year for eight years, whereas Investment Y offers to pay you $9,000 per year for live years. Which of these cash flow streams has the higher present value if the discount rate is 5 percent? If the discount rate is 22 percent?

Calculation of NPV andIRR on a project.

1.You have just paid $20 million in the secondary market for the winning Powerball lottery ticket. The prize is $2 million at the end of the year for the next 25 years. If your required rate of return is 8 percent, what is the net present value (NPV) of the deal?

2.Internal Rate of Return

What is the internal rate of return (IRR) of the Powerball deal in question 1?

Reference no: EM13356089

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