alleryStart learning →Outflows are 1,000 now and 1,100 at year 1; finance rate 10%. PV of outflows?
A1,900
B2,000
C2,100
D2,200
Answer & Solution
Correct answer: B. 2,000
The year-1 outflow is worth 1,100/1.1 = 1,000 today, so the total is 1,000 + 1,000 = 2,000.
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