Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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(Related to Checkpoint 6.6) (Present value of annuities and complex cash flows) You are given three investment alternatives to analyze. The cash flows from these three investments are as follows:
Investment Alternatives
End of Year
1
2
3
4
5
6
$
780
A
$ 19,000
19,000
19,000
19,000
19,000
B
$19,000
19,000
19,000
19,000
19.000
C
$19,000
95,000
a. What is the present value of investment A at an annual discount rate of 23 percent?
$ 53265.99 (Round to the nearest cent.)
b. What is the present value of investment B at an annual discount rate of 23 percent?
(Round to the nearest cent.)
..
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Transcribed Image Text:(Related to Checkpoint 6.6) (Present value of annuities and complex cash flows) You are given three investment alternatives to analyze. The cash flows from these three investments are as follows: Investment Alternatives End of Year 1 2 3 4 5 6 $ 780 A $ 19,000 19,000 19,000 19,000 19,000 B $19,000 19,000 19,000 19,000 19.000 C $19,000 95,000 a. What is the present value of investment A at an annual discount rate of 23 percent? $ 53265.99 (Round to the nearest cent.) b. What is the present value of investment B at an annual discount rate of 23 percent? (Round to the nearest cent.) ..
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