A
Anjum
Member
Hi Team,
Please Solve the equation of cash inflows for the below question:-
Project A: Initial payments of Rs. 2 million at time zero and Rs. 4 million at time 2 are made. In return a sum of Rs. 900,000 per annum is paid continuously from time 5 to time 25.
A per the equation will be 0.9 * continuous payable annuity for 21 years * v^4
whereas the solution is 0.9 * continuous payable annuity for 20 years * v^5
in the question if its mentioned payable from time 5 to time 25 why will we not include 5th year.
Please Solve the equation of cash inflows for the below question:-
Project A: Initial payments of Rs. 2 million at time zero and Rs. 4 million at time 2 are made. In return a sum of Rs. 900,000 per annum is paid continuously from time 5 to time 25.
A per the equation will be 0.9 * continuous payable annuity for 21 years * v^4
whereas the solution is 0.9 * continuous payable annuity for 20 years * v^5
in the question if its mentioned payable from time 5 to time 25 why will we not include 5th year.