Consider the following project s after tax cash flow and the expected annual general inflation rate during the project period

Question

Consider the following project s after tax cash flow and the expected annual general inflation rate during the project period Click on the following icon in order to copy its contents into a spreadsheet Expected End of Year 0 1 2 3 Cash Flow in Actual 45 000 32 000 32 000 32 000 General Inflation Rate 3 6 4 4 5 4 a Determine the average annual general inflation rate over the project period The average annual general inflation rate is 4 46 Round to two decimal places b Convert the cash flows in actual dollars into equivalent constant dollars with the base year 0 The equivalent cash flow in constant dollars at the end of year 0 is The equivalent cash flow in constant dollars at the end of year 1 is 45 000 Round to the nearest dollar Round to the nearest dollar

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