9.7Consider the following investment cash flows:YearCash flow0$20001$2000203$150

9.7Consider the following investment
cash flows:YearCash flow0$20001$2000203$15004$25005$4000a. What is
the present (Year 0) value of the cash flow stream if the opportunity cost rate
is 10 percent?b.What is
the value of the cash flow stream at the end of Year 5 if the cash flows are
invested in an account that pays 10 percent annually?c.What cash
flow today (Year 0) in lieu of the $2000 cash flow would be needed to
accumulate $20000 at the end of Year 5?
(Assume that the cash flows for Years 1 through 5 remain the same.)d.Time
value analysis involves either discounting or compounding cash flows.Many healthcare financial management
decisions such as bond refunding capital investment and lease versus buy
involve discounting projected future cash flows.What factors must executives consider when
choosing a discount rate to apply to forecasted cash flows?9.11Consider
the following investment cash flows:YearCash flow0($1000)1$2502$4003$5004$6005$600a. Expected return of
investment measured in dollar terms if the opportunity cost rate is 10 percentb. Provide explanation in
economic terms of your answerc. What is the return of
investment measured in percentage termsd. Should this investment be
made? Explain your answer