Question
Ignore #1's answer... its wrong :(
Zevon Co has identified an investment project with the following cash flows Requirement 1: Assume the discount rate is 12 percent, what is the present value of these cash flows? (Do not include the dollar sign ($). Enter rounded answer as directed, but do not use the rounded numbers in intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).) What is the present value at 15 percent? (Do not include the dollar sign ($). Enter rounded answer as directed, but do not use the rounded numbers in intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).) What is the present value at 21 percent? (Do not include the dollar sign ($). Enter rounded answer as directed, but do not use the rounded numbers in intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)
Explanation / Answer
1) 1010/1.12 + 820/1.12^2 + 1450/1.12^3 + 1810/1.12^4 = 3737.85 2)1010/1.15+ 820/1.15^2 + 1450/1.15^3 + 1810/1.15^4 = 3486.571 3)1010/1.21 + 820/1.21^2 + 1450/1.21^3 + 1810/1.21^4 = 3057.65