Python Exercises for Corporate Finance and Risk Management

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Question: 17

If the opportunity cost of capital is 9%, what is the appropriate interval for the present value of $374 paid in 9th year:


In this question we have to find out the present value of the cash flow, that will be paid in the 9th year from now, with the opportunity cost of 9%.

Given: Cash flow, Opportunity Cost

  • Define a function with the name "present_value" which will take two arguments, cashflow and opportunity cost.
  • The signature of the function should be like:

def present_value(future_value, opportunity_cost, time):

  • Use the following formula to find out the present value of the amount you will pay at the end of 9th year, using the opportunity cost.


Present value = Cash flow/ (1+ opportunity cost)**9

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