The cash flows for 4 investments with economic lives of 4,5,5 and 6 years respectively are as follows: ko kı k₂ k3 k4 ks k6 A -2100 750 750 750 1000 B -2200 650 650 650 650 1000 с -2300 600 600 700 700 1100 D -2400 650 650 650 650 650 800 The Required Rate of Return for all investments is 10%. Which of the four investments is the best financially if it is assumed that you cannot repeat the investments and you have a lack of funds(money)?

The cash flows for 4 investments with economic lives of 4,5,5 and 6 years respectively are as follows: ko kı k₂ k3 k4 ks k6 A -2100 750 750 750 1000 B -2200 650 650 650 650 1000 с -2300 600 600 700 700 1100 D -2400 650 650 650 650 650 800 The Required Rate of Return for all investments is 10%. Which of the four investments is the best financially if it is assumed that you cannot repeat the investments and you have a lack of funds(money)?

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Which of the following is closest to the future value of a cash flow of $1,000 invested today for 7 years given an interest rate of 4% p.a.? Group of answer choices A) Need more information to answer the question B) $1,315.93 C) $759.92 D) $1,310.80 E) $762.90
1. An investor has an opportunity to purchase any of the investments shown in the following table. Which purchase recommendations would you make, assuming that the investor can earn 10% on his investments? stream of cash number of years flows per year A 1 000 10 B 1 200 8. 900 11
At a rate of 10.0%, what is the future value of the following cash flow stream? Years: 1 3. CFs: $0 $75 $225 $0 $300 O a. $672 O b. $746 O c. $726 O d. $820 O e. $544
What is the present value of the following cash flow stream at a rate of 12.00%? Years: 0 1 2 3 4 CFs: $0 $75 $225 $0 $300 Select one: a. $511.28 b. $402.03 c. $546.24 d. $441.36 e. $436.99
What is the present worth (P) of all the cash flows if F=16000, n=6 years, and i= 8% per year? Select one: O a. $16,480.00 b. $103,824.00 O c. $10,082.71 O d. $34,608.00
What is the present value of the following cash flow stream at a rate of 8.0%? Years 0 1 2 3 4 Cash Flows ($) 750.00 2,450.00 2,450.00 - 4,000.00
If you invest $8,800, what is your rate of return if you will receive the following cash flows at the end of these years: Yr. 1 $2,000; Yr. 2 $2,100; Yr. 3 $2,200; Yr. 4 $2,300; Yr. 5 $3,700?
Fuente, Incorporated, has identified an investment project with the following cash flows. Cash Flow $700 925 1,125 1,250 Year 1 2 3 4 a.lf the discount rate is 11 percent, what is the future value of these cash flows in year 4? Future value at 11% b.What is the future value at a discount rate of 18 percent? Future value at 18%
An investment yields a cash flow of $2 000 in years 1 & 2, and in years 3 - 5, an annual cash flow of $1 000. Using a 10% discount rate, what is the total present value of these flows? a. $8677 b. $6050 c. $5526 d. $4132
An initial investment of $ 25000 in a business guarantees the following cash flows:Year Cash Flow3 8, 0004 10, 0006 14, 000Assume an interest rate of 5% compounded annually. Find the net present value of thecash flows.
For the cash flows shown, determine the future worth in year 5. Year Cash Flow, $/Year Estimated i Per Year 0 5000 12% 1– 4 6000 12% 5 9000 20%
✓ Number of years to provide a given return In the information given in following case, determine the number of years that the given oridinary annuity cash flows must continue in order to provide the rate of return on the initial amount. (Click on the icon here in order to copy the contents of the data table below into a spreadsheet.) Initial amount $170,100 Annual cash flow $20,473 GCXX Rate of return 5% The number of investment years, n, isyears. (Round to two decimal places.) st art

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