Final answer:
To calculate the present value of cash flows, use the present value formula: PV = CF/(1+r)^n. The present values at discount rates of 10%, 18%, and 24% are $1090.91, $496.69, and $621.17 respectively.
Step-by-step explanation:
To calculate the present value of the cash flows in the investment project, we use the present value formula:
PV = CF/(1+r)^n, where PV is the present value, CF is the cash flow, r is the discount rate, and n is the number of periods.
Using this formula, we can calculate the present value of the cash flows for the discount rates of 10%, 18%, and 24%.
Taking each cash flow and dividing it by the appropriate discount rate raised to the power of the year, we find the present values to be $1200/(1+0.10)^1 = $1090.91, $600/(1+0.10)^2 = $496.69, $855/(1+0.10)^3 = $621.17, $1480/(1+0.10)^4 = $980.86 at a discount rate of 10%; $1200/(1+0.18)^1 = $1016.95, $600/(1+0.18)^2 = $358.96, $855/(1+0.18)^3 = $431.11, $1480/(1+0.18)^4 = $657.14 at a discount rate of 18%; and $1200/(1+0.24)^1 = $967.74, $600/(1+0.24)^2 = $310.48, $855/(1+0.24)^3 = $350.38, $1480/(1+0.24)^4 = $488.89 at a discount rate of 24%.