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Answer :
To calculate the present value of a cash flow of £97 million that you expect to receive 7 months from now when the risk-free rate is 1.9% and the discount rate is 3.8%, we need to use the following formula:
Present Value = Cash Flow / (1 + Discount Rate)^Time
Where:
Cash Flow = £97 million
Discount Rate = 3.8%
Time = 7 months = 7/12 years
Let's calculate the present value:
Present Value = £97 million / (1 + 0.038)^(7/12)
We find that the present value of cash flow is approximately £94.90 million.
Therefore, the correct answer is option C. £94.9.
Learn more about the topic: brainly.com/question/32287514
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