For part bOption(5) 7 yearsOption (6) 8 yearsOption (7) 9 yearsOption (8) 10 years You want to invest in a new small business venture. If you invest $10,000, you have aguaranteed payment of $850 at the end of the 1st year, $1,200 the following year,$1,800 after that and then $2,000 annually going forward for as long as you keepyour money in the business. Your MARR is 8% annually.(a) What is the discounted cash flow at year 5? Select between options 1 to 4 below.(b) What is the discounted payback period on your investment? Assume the cashflow is received at the end of the year. Select between options 5 to 8 below.Select 2 correct answer(s)OOption 1 (Part a):$1,361Option 2 (Part a):$1,567OOption 3 (Part a):-$3,924Option 4 (Part a):$2,000

Cash Outflow at Year 0 = $10,000 Cash Outflow at Year 1 = $850 Cash Outflow at Year 2 = $1,200 Cash…

Answered: You want to invest in a new small…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 22P

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