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What is the Net Present Value of the following cash flow streams at an interest rate of 8.25%: at year : sor year 1: $75 year 2: $225; year 3: S0 and year 4 $300,

Respuesta :

Answer:

the net present value is $480

Explanation:

The computation of the net present value is shown below

Year  Cash flows    discount rate     Present value

0        -$0                    1                      -$0

1        $75                0.924                   $69

2       $225             0.853                   $192

3         $0               0.788                    $0

4        $300           0.728                    $218

Net present value                              $480

hence, the net present value is $480

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