maths
posted by riya
Calculate the total present value today (to 2 decimal places) of the following cash flows:
$300 due in 2 years from today
$1,000 due in 5 years from today
$200 due in 15 years from today
Use an interest rate of 12% per annum.

MathMate
i=0.12
use
P=F*(P/F,i,n)=F/((1+i)^n)
P1=300/(1.12^3)=213.53
P2=1000/(1.12^5)=567.43
P3=200/(1.12^15)=36.54
(negative because money is due in the future)
P=P1+P2+P3 [present value] 
MathMate
P1=300/(1.12^3)=213.53
P2=1000/(1.12^5)=567.43
P3=200/(1.12^15)=36.54
(negative because money is due in the future)
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