Computer_lab_1

# Computer_lab_1 - SINGLE CASH FLOW Present Value Problem...

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Present Value Inputs Single Cash Flow \$50,000.00 Discount Rate / Period 8.0% Number of Periods 4 Present Value using the Formula Present Value \$36,751.49 Present Value using the PV Function Present Value (\$36,751.49) S INGLE C ASH F LOW Problem: Your company has told you that you if you remain employed with them, you will receive a \$50,000 bonus four years from today. Assume a discount rate of 8%. Fill in this spreadsheet, calculating the present value in two different ways.

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Inputs Payment \$1,000,000 Discount Rate / Period 5.16% Number of Periods 30 Annuity Present Value using a Time Line Period 0 1 2 3 4 5 6 7 Cash Flows 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 Present Value of Each Cash Flow 1,000,000 950,953 904,312 859,958 817,780 777,670 739,528 703,256 Present Value \$16,100,000 Annuity Present Value using the PV Function Present Value (\$16,100,000) Compare PV to: Lump sum option \$16,100,000 Difference (Annuity PV - Lump sum) (\$0) A NNUITY Problem: Kenny Dukes, Lottery Winner. Refer to the 1st newspaper article to answer the questions.
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Computer_lab_1 - SINGLE CASH FLOW Present Value Problem...

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