标题: Quant Question from Qbank.. [打印本页] 作者: optiix 时间: 2011-7-13 16:34 标题: Quant Question from Qbank..
can somewhy tell me why I cant calculate the same method for year 8-9 as with year 1-5? for example in year 8-9 why cant I go n=2, i/y=8 pmt = -2000 and cpt -> pv like i did from year 1-5?....i get the answer of 3566.53 for year 8 and 9 together but in the solution it calculated year 8 and 9 seperately and got 2080...why? If i did it this way i would get answer C but its answer B
thanks
A firm is evaluating an investment that promises to generate the following annual cash flows:
End of Year Cash Flows
1 $5,000
2 $5,000
3 $5,000
4 $5,000
5 $5,000
6 -0-
7 -0-
8 $2,000
9 $2,000
Given BBC uses an 8% discount rate, this investment should be valued at:
A) $19,963.
B) $22,043.
C) $23,529.
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Click for Answer and Explanation
because your calculation is only discounting the payments for 2 periods instead of 9.... this is a REALLY REALLY basic calculation作者: burnsy562000 时间: 2011-7-13 16:34
my bad, ive been reviewing qbank now for a few hrs my brain must not be working right. thanks for the post作者: joemoran 时间: 2011-7-13 16:34
Easiest way to do this is use the cash flow and NPV function on the calculator:
