Problem
You expect to receive $1,000 in one year, $2,000 in three years, and $1,500 in five years. Assume that the appropriate discount rate is 13%.
I. Display these cash flows in a spreadsheet using the layout of a time line. Enter all period numbers (up to year 5) in one row, and the expected cash flows in the next row.
II. What is the present value of these expected cash flows?