What is the present value of the following cash flow stream at a rate of 8.0%? Years: 0 1 2 3 | | | | CFs: Php750 Php2,450 Php3,175 Php4,400 A. Php7,917 B. Php8,333 C. Php8,772 D. Php9,233 E. Php9,695

What is the present value of the following cash flow stream at a rate of 8.0%? Years: 0 1 2 3 | | | | CFs: Php750 Php2,450 Php3,175 Php4,400 A. Php7,917 B. Php8,333 C. Php8,772 D. Php9,233 E. Php9,695

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter19: Capital Investment

Section: Chapter Questions

Problem 23E: Assume that an investment of 100,000 produces a net cash flow of 60,000 per year for two years. The...

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Question

What is the present value of the following cash flow stream at a rate of 8.0%?

Years: 0 1 2 3

| | | |

CFs: Php750 Php2,450 Php3,175 Php4,400

A. Php7,917 B. Php8,333 C. Php8,772 D. Php9,233

E. Php9,695

Definition Definition Net amount of cash that an entity receives and expends over the course of a given period. For a business to continue operating, positive cash flows are required, and they are also necessary to produce value for investors. Investors in particular prefer to see growing cash flows even after capital expenditures have been paid for (which is known as free cash flow).

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