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Consider the following cash flow stream. What is the correct way to find the present...

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Question

Finance

Consider the following cash flow stream. What is the correct way to find the present value of this cash flow stream at a 10% discount rate?

0 1 2 3 4 5 6 7 8 9 10

|----------|----------|----------|----------|---------|----------|----------|----------|----------|----------|

PV=? $30 $30 $30 $30 $25 $25 $25 $25 $25 $25

A.

PV = $30 [PVIFA(10%, 4)] + $25 [PVIFA(10%, 6)]

B.

PV = $30 [PVIFA(10%, 10)] - $5 [PVIFA(10%, 4)]

C.

PV = $25 [PVIFA(10%, 10)] + $5 [PVIFA(10%, 4)]

D.

PV = $30 [PVIFA(10%, 4)]/(1.10)6 + $25 [PVIFA(10%, 6)]

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