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8 You are considering a project which will provide annual cash inflows of $4,500, $5,700, $10,000,...

8 You are considering a project which will provide annual cash inflows of $4,500, $5,700, $10,000, and 24,000 at the end of each year for the next four years, respectively. What is the present value of these cash flows, given a 10.35 percent discount rate?

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Answer #1

Calculation of the present value of cash inflows :-

Present value factor (PVF) formula = 1 / ( 1+i)n

Years Cash inflows PVF@ 10.35% PV of CF
1 4,500 0.906207522     4,077.9338469
2 5,700 0.821212072     4,680.9088108
3 10,000 0.744188556     7,441.8855647
4 24,000 0.674389267 16,185.3424153
Present value of cash inflows 32,386.0706376

Present value of cash inflows = $ 32,386.07

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