table%20bAjpg https:/newconnect.mheducation.com/flow/connecthtm ack of book) Ass

Question

table%20bAjpg https:/newconnect.mheducation.com/flow/connecthtm ack of book) Assignment Quiz-30 minutes Cll, Inc., year until the entire investment is liquidated 12 years of $1 PVA of $1, and FVA of $) (Use appropriete fectoris) frem the tables provided. Round FV factor to 4 invests $650,000 in a project expected to earn a 12% annual rate of return. The earnings will be reinvested in the project each ater. What will the cash proceeds be when the project is liquidated? t IFV of a SinopFuture Value S 650 8 5 6 3 4

Explanation / Answer

PV factor for 12th year at 12% Interest rate = [1/(1.12)12] = 0.256675093
Hence, 1 / 0.256675093 = 3.8976

Future Value = $650000 x 3.8976 = $2,533,440

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