Appropriate CF 1 CF 2 CF n

Asset End of Year Amount V 0= 1

+ 2
+… n
required return (1+ r) (1+r )   (1+r )

5,000 5,000
A 1 $ 5,000 V 0= 1 V 0= $ 4,237
(1+ 0.18) 1.18
5,000 5,000
2 5,000 18% V 0= 2 V 0= 3,590
(1+ 0.18) 1.3924
5,000 5,000
  3 5,000 V 0= V 0= 3,043
(1+ 0.18)
3
1.643032
1 through 1 1
B $ 300 15% V 0=CF x V 0=300 x
∞ r 0.15

C 1 0

2 0

3 0
16%

4 0

35,000 35,000
V 0= V 0=
5 $ 35,000 (1+ 0.16)5 2.10034
V 0=CF x PVIFA V 0=1,500 x 3.605
D 1 through 5 $ 1,500   $ 5,407
12%
8,500 8,500
  6 8,500 V 0= 6 V 0= 4,306
(1+ 0.12) 1.973823
2,000 2,000
E 1 $ 2,000 V 0= V 0= $ 1,754
(1+ 0.14)1 1.14
3,000 3,000
2 3,000 V 0= 2 V 0= 2,308
(1+ 0.14) 1.2996
5,000 5,000
3 5,000 V 0= 3 V 0= 3,374
(1+ 0.14) 1.481544
14%
7,000 7,000
4 7,000 V 0= 4 V 0= 4,144
(1+ 0.14) 1.68896
4,000 4,000
5 4,000 V 0= V 0= 2,077
(1+ 0.14)5 1.925415
1,000 1,000
  6 1,000 V 0= 6 V 0= 455
(1+ 0.14) 2.194973