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You invest $400,000 and receive $10,000 at the end of year 1, followed by $12,000 at the end of year 2, $14,000 at the end of year three, ect, through the end of year 6.

Revenues will remain flat (i.e. constant amount) from year 6 to year 12 when you sell your investment for $250,000.

The effective interest rate is 6.0%

A) FInd the equivalent present worth for the cash flow.

B) Find the equivalanent worth of the cash flow at year 10.

C) Find the equivalent annual amount of this cash flow for the period 0 through the end of year 12.

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M92775145

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