Multiple Choice
You have received a settlement offer from an automobile manufacturer due to mechanical problems with your automobile.The manufacturer will pay you $49,000 in one lump sum five years from now.You can earn 6% on your investments.The present value of $1 for 5 periods at 6% is 0.747.The present value of an ordinary annuity of $1 for 5 periods at 6% is 4.212.The present value of the manufacturer's settlement offer is closest to:
A) $36,015.
B) $49,000.
C) $36,603.
D) $206,388.
Correct Answer:
Verified
Correct Answer:
Verified
Q2: The process of determining the present value
Q3: To calculate the future value of an
Q4: Ordinary annuity investments provide multiple receipts of
Q5: The difference between the future value of
Q6: A single amount of $6,400 is to
Q7: Most businesses ignore compound interest when calculating
Q8: You have won $1,250,000 in a lottery.Your
Q9: Compound interest is only the interest you
Q10: Whether making investments or borrowing money,we don't
Q11: Cooper Company has purchased equipment that requires