You Estimate That the Little Drive-Through Coffee Kiosk You Own

Multiple Choice

You estimate that the little drive-through coffee kiosk you own will generate ordinary annuity after-tax cash flows of $150,000 per year for the next ten years. If you discount these cash flows at an annual rate of 14%, what is the present value of your expected cash flows?

A) $782,417.35
B) $891,955.78
C) $1,500,000
D) $2,900,594.27