The present value of a 670 payment in three years when the discount rate is 7 percent i $546.92.
Cash flow refers to the net balance of coins stepping into and out of an enterprise at a specific factor in time. cash is continuously entering into and out of an enterprise. for example, when a retailer purchases stock, money flows out of the commercial enterprise closer to its suppliers.
Cash flow is a dimension of the number of coins that comes into and from your commercial enterprise in a specific time period. when you have advantageous coins flow, you have got greater cash coming into your enterprise than you've got leaving it so that you pay your payments and cowl other expenses.
$546.92
Statement showing Cash flows
Particulars Time PVF 7% Amount PV
Cash flows 1.00 0.9346 - -
Cash flows 2.00 0.8734 - -
Cash flows 3.00 0.8163 670.00 546.92
Present value of Cash Flows 546
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