Question
Asked Feb 3, 2020
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The present value of the following cash flow stream is $6500 when discounted at 10% annually.  What is the value of the missing cash flow?

year                Cash Flow

1                      1000

2                      ?

3                       2000

4                       2000

 

Thank you susan

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Expert Answer

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Step 1

The calculation of the missing cash flow is as follows:

 

Finance homework question answer, step 1, image 1

 

Hence, the cash flow of the 2nd year is $3,294.

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