Assuming an annual discount rate of 15 percent, find the present value of each investment. Question content area bottom Part 1 a. What is the present value of investment A at an annual discount rate of 15 percent? $enter your response here (Round to the nearest cent.) Part 2 b. What is the present value of investment B at an annual discount rate of 15 percent? $enter your response here (Round to the nearest cent.) Part 3 c. What is the present value of investment C at an annual discount rate of 15 percent? $enter your response here (Round to the nearest cent.)
Assuming an annual discount rate of 15 percent, find the present value of each investment. Question content area bottom Part 1 a. What is the present value of investment A at an annual discount rate of 15 percent? $enter your response here (Round to the nearest cent.) Part 2 b. What is the present value of investment B at an annual discount rate of 15 percent? $enter your response here (Round to the nearest cent.) Part 3 c. What is the present value of investment C at an annual discount rate of 15 percent? $enter your response here (Round to the nearest cent.)
Financial And Managerial Accounting
15th Edition
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:WARREN, Carl S.
Chapter26: Capital Investment Analysis
Section: Chapter Questions
Problem 2MAD: Assume San Lucas Corporation in MAD 26-1 assigns the following probabilities to the estimated annual...
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Question content area top
Part 1
(Related to Checkpoint 6.6)
annuities and complex cash
(Present
value of flows)
You are given three investment alternatives to analyze. The cash flows from these three investments are as follows:|
Investment Alternatives
|
||||||
|
End of Year
|
A
|
|
B
|
|
C
|
|
|---|---|---|---|---|---|---|
|
1
|
$
|
14,000
|
|
|
$
|
14,000
|
|
2
|
|
14,000
|
|
|
|
|
|
3
|
|
14,000
|
|
|
|
|
|
4
|
|
14,000
|
|
|
|
|
|
5
|
|
14,000
|
$
|
14,000
|
|
|
|
6
|
|
|
|
14,000
|
|
70,000
|
|
7
|
|
|
|
14,000
|
|
|
|
8
|
|
|
|
14,000
|
|
|
|
9
|
|
|
|
14,000
|
|
|
|
10
|
|
|
|
14,000
|
|
14,000
|
(Click
on the icon
spreadsheet.)
Assuming an annual discount rate of
15
percent, find the present value of each investment.Question content area bottom
Part 1
a. What is the present value of investment A at an annual discount rate of
15
percent?$enter your response here
(Round to the nearest cent.)Part 2
b. What is the present value of investment B at an annual discount rate of
15
percent?$enter your response here
(Round to the nearest cent.)Part 3
c. What is the present value of investment C at an annual discount rate of
15
percent?$enter your response here
(Round to the nearest cent.)Expert Solution
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