UNEVEN CASH FLOW STREAM Find the present values of the following cash flow streams at a 9%...

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UNEVEN CASH FLOW STREAM
Find the present values of the following cash flow streams at a9% discount rate. Round your answers to the nearest cent.
0 1 2 3 4 5
Stream A $0 $150 $400 $400 $400 $300
Stream B $0 $300 $400 $400 $400 $150
Stream A $
Stream B $
What are the PVs of the streams at a 0% discount rate?
Stream A $
Stream B $

Answer & Explanation Solved by verified expert

4.1 Ratings (583 Votes)

Ans a) Stream A $ 1261.51

Stream B $ 1301.63

b) Stream A: $ 1650

Stream B: $ 1650

STREAM A
Year	Project Cash Flows (i)	DF@ 9%	DF@ 9% (ii)	PV of Project ( (i) * (ii) )	DF@ 0% (ii)	PV of Project A ( (i) * (ii) )
0	0	1	1	-	1	-
1	150	1/((1+9%)^1)	0.917	137.61	1.000	150.00
2	400	1/((1+9%)^2)	0.842	336.67	1.000	400.00
3	400	1/((1+9%)^3)	0.772	308.87	1.000	400.00
4	400	1/((1+9%)^4)	0.708	283.37	1.000	400.00
5	300	1/((1+9%)^5)	0.650	194.98	1.000	300.00
		NPV		1,261.51	NPV	1,650.00

STREAM B
Year	Project Cash Flows (i)	DF@ 9%	DF@ 9% (ii)	PV of Project ( (i) * (ii) )	DF@ 0% (ii)	PV of Project A ( (i) * (ii) )
0	0	1	1	-	1	-
1	300	1/((1+9%)^1)	0.917	275.23	1.000	300.00
2	400	1/((1+9%)^2)	0.842	336.67	1.000	400.00
3	400	1/((1+9%)^3)	0.772	308.87	1.000	400.00
4	400	1/((1+9%)^4)	0.708	283.37	1.000	400.00
5	150	1/((1+9%)^5)	0.650	97.49	1.000	150.00
		NPV		1,301.63	NPV	1,650.00

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Transcribed Image Text

UNEVEN CASH FLOW STREAMFind the present values of the following cash flow streams at a9% discount rate. Round your answers to the nearest cent.012345Stream A$0$150$400$400$400$300Stream B$0$300$400$400$400$150Stream A $ Stream B $ What are the PVs of the streams at a 0% discount rate?Stream A $ Stream B $

Stream A	$0	$150	$400	$400	$400	$300
Stream B	$0	$300	$400	$400	$400	$150