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Dear John,
Please could you solve this problem.
A particular project requires an initial cash outflow of 60,000. 2 years from now, there will be a cash inflow of 20,000 ,with an inflow of the same amount each year after that for 5 years. Discount rate : 10%You need the total discount factor from years 2 to 6.
There are two ways of getting it, but the best is to take the 6 year annuity factor (which gives the total from years 1 to 6) and subtract from it the 1 year discount factor.
(Have you watched the lectures on this? Because I go through examples just like this one.)
No, I have not watched it. But i am watching it now. Thank you for your reply.
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