The appropriate discount rate for the following cash flows is 12 percent compounded quarterly. |
Year | Cash Flow |
1 | $800 |
2 | 700 |
3 | 0 |
4 | 1,400 |
Required:
What is the present value of the cash flows? |
Multiple Choice
$2,178.57
$2,093.13
$2,135.85
$2,162.05
$383.67
Net present value can be solved using a financial calculator. The steps to solve on the financial calculator:
Net present value at 12% discount rate is $2,162.05.
Hence, the answer is option d.
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