?(Related to Checkpoint? 6.6)?? ?(Present value of annuities and complex cash flows?) You are given three investment...

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?(Related to Checkpoint? 6.6)??
?(Present value of annuities and complex cash flows?)
You are given three investment alternatives to analyze. The cashflows from these three investments are as? follows:
Investment Alternatives
End of Year
A
B
C
1
?$
16,000
?$
16,000
2
??
16,000
3
??
16,000
4
??
16,000
5
??
16,000
?$
16,000
??
6
??
16,000
80,000
7
16,000
8
16,000
9
16,000
10
16,000
16,000
Assuming an annual discount rate of 22 ?percent, find thepresent value of each investment.
a.??What is the present value of investment A at an annualdiscount rate of 22 percent?
???(Round to the nearest? cent.)
b.??What is the present value of investment B at an annualdiscount rate of
22 ?percent????(Round to the nearest? cent.)
c.??What is the present value of investment C at an annualdiscount rate of 22 ?percent??
?(Round to the nearest? cent.)

Answer & Explanation Solved by verified expert

4.0 Ratings (432 Votes)

aThe Present value of investment A at an annual discount rate of 22 percent Year Annual Cash Inflow Present Value factor at 22 Present Value of Annual Cash Flow 1 16000 0819672 1311475 2 16000 0671862 1074980 3 16000 0550707 881131 4 16000 0451399 722239 5 16000 0369999 See Answer

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?(Related to Checkpoint? 6.6)???(Present value of annuities and complex cash flows?)You are given three investment alternatives to analyze. The cashflows from these three investments are as? follows:Investment AlternativesEnd of YearABC1?$16,000?$16,0002??16,0003??16,0004??16,0005??16,000?$16,000??6??16,00080,000716,000816,000916,0001016,00016,000Assuming an annual discount rate of 22 ?percent, find thepresent value of each investment.a.??What is the present value of investment A at an annualdiscount rate of 22 percent????(Round to the nearest? cent.)b.??What is the present value of investment B at an annualdiscount rate of22 ?percent????(Round to the nearest? cent.)c.??What is the present value of investment C at an annualdiscount rate of 22 ?percent???(Round to the nearest? cent.)

Investment Alternatives
End of Year	A		B		C
1	?$	16,000			?$	16,000
2	??	16,000
3	??	16,000
4	??	16,000
5	??	16,000	?$	16,000	??
6			??	16,000		80,000
7				16,000
8				16,000
9				16,000
10				16,000		16,000