Answer:
A. $[tex]102138.76[/tex]
Explanation:
[tex]Since~ there~ are~ uneven ~cash~ flows,~ we ~will~ have~ to ~calculate ~each\\ cash ~flow ~separately ~for~ that~ year.[/tex]
[tex]We~have~to~use~the~formula~which~is:[/tex]
[tex]PV=\frac{CF}{(1+r)^n} +\frac{CF}{(1+r)^n}+\frac{CF}{(1+r)^n}[/tex]
[tex]Where:[/tex]
[tex]CF=Cash~Flows[/tex]
[tex]r=Discount~rate[/tex]
[tex]n=number~of~period.[/tex]
[tex]Putting~up~all~the~values,~we~get:[/tex]
[tex]PV=\frac{38,000}{(1+0.105)^1}+ \frac{42,000}{(1+0.105)^2} +\frac{42,000}{(1+0.105)^3}=[/tex] $[tex]102138.76[/tex]
[tex]Thus,~option~``a"~is~correct![/tex]
