You have been offered the opportunity to invest in a project that will pay $5,943 per year at the end of years one through three and $6,356 per year at the end of years four and five. These cash flows will be placed in a saving account that pays 17.40 percent per year. What is the future value of this cash flow pattern at the end of year five?
$ 42,914.97
Year | Cash flow | Future Value of 1 | Future Value of cash flow | ||
a | b | c=1.1740^(5-a) | d=b*c | ||
1 | 5943 | 1.8996 | 11,289.59 | ||
2 | 5943 | 1.6181 | 9,616.34 | ||
3 | 5943 | 1.3783 | 8,191.09 | ||
4 | 6356 | 1.1740 | 7,461.94 | ||
5 | 6356 | 1.0000 | 6,356.00 | ||
Total | 42,914.97 | ||||
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