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Compute the present discounted value of given income streams

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Question: Present discounted values (II): Repeat exercise for an interest rate of 1%, then for an interest rate of 5%. Arrange your answers in a table so you can more easily see the difference a change in the interest rate makes.

Exercise: Present discounted values (I): Compute the present discounted value of the following income streams. Assume the interest rate is 3%.

(a) $50,000, received 1 year from now.

(b) $50,000, received 10 years from now.

(c) $100 every year, forever, starting immediately.

(d) $100 every year, forever, starting 1 year from now.

(e) $100 every year for the next 50 years, starting immediately.

Reference no: EM131634368

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