Year Amount $20,000/yr. 35,000/yr. 1-5 6-10 Find the present value of cash flows, assuming that the firm's opportunity cost is 14 percent. Lütfen birini seçin: a. $120,820 O b. $131,065 c. $ 14,850 d. $ 19,830

Year Amount $20,000/yr. 35,000/yr. 1-5 6-10 Find the present value of cash flows, assuming that the firm's opportunity cost is 14 percent. Lütfen birini seçin: a. $120,820 O b. $131,065 c. $ 14,850 d. $ 19,830

Financial Management: Theory & Practice

16th Edition

ISBN:9781337909730

Author:Brigham

Publisher:Brigham

Chapter7: Corporate Valuation And Stock Valuation

Section: Chapter Questions

Problem 11P: Brook Corporation’s free cash flow for the current year (FCF0) was $3.00 million. Its investors...

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Concept explainers

Present Value

Present value (PV) is defined as the current or present value of all future sums of cash flow or money at a specified rate of return. This rate of return is known as the discounted rate, which is essentially the interest rate, discounted over some time. The expected cash flows are discounted at a discount rate to compute the present value. The higher the discount rate, the higher the future value (FV), but the lower the present value.

Question

Year
Amount
$20,000/yr.
35,000/yr.
1-5
6-10
Find the present value of cash flows, assuming that the firm's opportunity cost is 14 percent.
Lütfen birini seçin:
a. $120,820
O b. $131,065
c. $ 14,850
d. $ 19,830

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