Find the total value of the given income stream and also find its present value (at the beginning of the given interval)using the given interest rate.
A)TV = $0, PV = $248,477.55
B)TV = $45,317.31, PV = $59,866.79
C)TV = $55,350.69, PV = $46,430.67
D)TV = $454,682.69, PV = $1,392.92
E)TV = $2,214.03, PV = $46,430.67

Question

Find the total value of the given income stream and also find its present value (at the beginning of the given interval)using the given interest rate. 
A)TV = $0, PV = $248,477.55 
B)TV = $45,317.31, PV = $59,866.79 
C)TV = $55,350.69, PV = $46,430.67 
D)TV = $454,682.69, PV = $1,392.92 
E)TV = $2,214.03, PV = $46,430.67

Quizplus · Accepted Answer

Without seeing the calculations, we cannot determine the exact interest rate used or the time period of the income stream. However, we can use the present value formula to determine which option is correct. Option C has a higher total value than option B and D, which tells us that the interest rate used must be relatively low. Option A has a total value of $0, which means the present value must be equal to the sum of the future values. This is not possible unless the interest rate is extremely high, which would make option E the only possible choice. However, option E has a very low total value and a high present value, which is unlikely given our assumption of a relatively low interest rate. Therefore, option C is the best choice as it has a reasonable total value and present value based on our assumptions.

Find the Total Value of the Given Income Stream and Also