Entrepreneurial Financial Management Notes

Question 1 (10 Marks) Given the following set of cash flows: Period Cash Flow 1 45 000 25 000 (2) a. If your required rate of return is 9% per year, calculate BOTH the present and future value of the above stream of cash flows? b. Now, suppose that you are offered another investment that is identical, except that the cash flows are reversed (i.e., cash flow 1 is 20 000, cash flow 2 is 30 000, cash flow 3 is 35 000, cash flow 4 is 40 000 and cash flow 5 is 45 000). Is this worth more ...

Question 1 (10 Marks) Given the following set of cash flows: Period Cash Flow 1 45 000 25 000 (2) a. If your required rate of return is 9% per year, calculate BOTH the present and future value of the above stream of cash flows? b. Now, suppose that you are offered another investment that is identical, except that the cash flows are reversed (i.e., cash flow 1 is 20 000, cash flow 2 is 30 000, cash flow 3 is 35 000, cash flow 4 is 40 000 and cash flow 5 is 45 000). Is this worth more ...