Assume that your required rate of return is 12 percent and you are given the following stream of cash flows: year cash flow 0 $10,000 1 15,000 2 15,000 3 15,000 4 15,000 5 20,000 if payments are made at the end of each period, what is the present value of the cash flow stream?

The present value of the cash flow stream is $66,908.79

Explanation:

To compute the present value of the cash inflows, we have to multiply the present value factor with the yearly cash inflows

The discount factor should be computed by a formula which is shown below

= (1) ÷ (1 + rate) ÷ year

For year 0 = (1 ÷ 1.12) ^ 0 = 1

For year 1 = (1 ÷ 1.12) ^ 1 = 0.8929

For year 2 = (1 ÷ 1.12) ^ 2 = 0.7972

For year 3 = (1 ÷ 1.12) ^ 3 = 0.7118

For year 4 = (1 ÷ 1.12) ^ 4 = 0.6355

For year 5 = (1 ÷ 1.12) ^ 5 = 0.5674

Now, multiply this discount factor with yearly cash inflows

So, the value would be equal to

= ($10,000 × 1)+ ($15,000 × 0.8929) + ($15,000 ×  0.7972) + ($15,000 ×  0.7118) + ($15,000 ×  0.6355) + ($20,000 ×  0.5674)

= $10,000 + $13,392.86 + $11,957.91 + $10,676.70 + $9,532.77 + $11,348.54

= $66,908.79

the correct answer is economics is a game without winners or losers.

unlike sports or games economic is a game without losers or winner rather it is a game where everyone wins. parties of business doing businesses exchange money with each other and hence exchange is done on the basis of goods. one party takes the goods and other sales it so there is winner on both sides. each party values more highly the good it gets than the good it gives up. both sides exchange only because both intend to increase their value. so there is no concept of lose or win.

answer; ///deficit;