A project with a 3-year life has the following probability distributions for possible end of year cash flows in each of the next three years: Using an interest rate of 8 percent, find the expected present value of these uncertain cash flows.(Hint: Find the expected cash flow in each year, then evaluate those cash flows.)
A) $1,204.95
B) $835.42
C) $1,519.21
D) $1,580.00
E) $1,347.61

Question

A project with a 3-year life has the following probability distributions for possible end of year cash flows in each of the next three years:  Using an interest rate of 8 percent, find the expected present value of these uncertain cash flows.(Hint: Find the expected cash flow in each year, then evaluate those cash flows.)
A) $1,204.95 
B) $835.42 
C) $1,519.21 
D) $1,580.00 
E) $1,347.61

Quizplus · Accepted Answer

The Answer of A project with a 3-year life has the following probability distributions for possible end of year cash flows in each of the next three years:  Using an interest rate of 8 percent, find the expected present value of these uncertain cash flows.(Hint: Find the expected cash flow in each year, then evaluate those cash flows.)
A) $1,204.95 
B) $835.42 
C) $1,519.21 
D) $1,580.00 
E) $1,347.61

A Project with a 3-Year Life Has the Following Probability