What is the present value of the following cash flow stream at a rate of 6.25%?
A) $411.57
B) $433.23
C) $456.03
D) $480.03
E) $505.30

Question

What is the present value of the following cash flow stream at a rate of 6.25%? 
A) $411.57 
B) $433.23 
C) $456.03 
D) $480.03 
E) $505.30

Quizplus · Accepted Answer

I/YR = 6.25%
 $\begin{array}{lccccc} 
& \mathrm{U} & 1 & 2 & 3 & 4 \
 \text { CFs: } & \$ 0 & \$ 75 & \$ 225 & \$ 0 & \$ 300 \
\text { PV of CFs. } & \$ 0 & \$ 71 & \$ 199 & \$ 0 & \$ 235
\end{array}$ 
PV = $505.30
PV = $505.30
You can find the individual PVs and sum them.Alternately,you can automate the process using Excel or a calculator,by inputting the data into the cash flow register and pressing the NPV key.

What Is the Present Value of the Following Cash Flow