You win a judgment in an auto accident for $100,000. You immediately receive $25,000 but must pay
Question:
You win a judgment in an auto accident for $100,000. You immediately receive $25,000 but must pay your lawyer's fee of $15,000. In addition, you will receive $2,500 a year for 20 years for a total of $50,000, after which the balance owed ($25,000) will be paid. If the interest rate is 7 percent, what is the current value of your settlement?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 63% (11 reviews)
This problem illustrates that what may appear to be a substantial amount ...View the full answer
Answered By
Michael Mulupi
I am honest,hardworking, and determined writer
4.70+
72+ Reviews
157+ Question Solved
Related Book For
Basic Finance An Introduction to Financial Institutions Investments and Management
ISBN: 978-1111820633
10th edition
Authors: Herbert B. Mayo
Question Posted:
Students also viewed these Accounting questions
-
If you are at fault in an auto accident and carry an auto liability insurance requirement of 20/40/15, what is the total dollar amount of your coverage?
-
Which is the largest if the interest rate is 10%? a. future value of $100 after five years b. present value of $100 annuity for five years c. present value of $100 after five years d. future value of...
-
If the interest rate is 6% per year, how long will it take for your money to quadruple in value? If the inflation rate is 4% per year, what will be the change in the purchasing power of your money...
-
A U.S Company David Inc. sold merchandise to Fernando SA for 10,000 on September 14, 2017. The spot rate for euro is $0.720 on this day. On October 12, 2018, David Inc. purchased merchandise from...
-
The annual dues for the Southern Pines Golf Club are $2140 for regular members and $856 for student members. If the total revenue from the dues of 583 members for the past year was $942,028, how many...
-
DeeZees makes evening dresses. The following information was gathered from the company records for 2013, the first year of company operations. Work in Process Inventory at the end of 2013 was $...
-
Jenna Smith recently purchased an annuity contract that will pay her \(\$ 375,000\) per year for the next seven years. According to Smith's calculations, the estimated internal rate of return on this...
-
This problem continues the Draper Consulting, Inc., situation from P21-35 of Chapter 21. Assume Draper Consulting began January with $29,000 cash. Management forecasts that collections from credit...
-
read the case of Trustees of Empire State Carpenters et al. v. Rodrigue, located in your readings and resources. In this journal, you will reflect upon personal liability as it applies to this case....
-
Which statement is true when customers pay bills with a credit card? Question 1 options: a) You can use QuickBooks' Merchant Account Service to get online authorization and then download payments...
-
Auntie Kitty sells her house for $200,000, which is then invested to earn 6 percent annually. If her life expectancy is 10 years, what is the maximum amount she can annually spend on a nursing home,...
-
A firm must choose between two investment alternatives, each costing $100,000. The first alternative generates $35,000 a year for four years. The second pays one large lump sum of $157,400 at the end...
-
State the order of decisions in method development for gas chromatography.
-
Peanut Ltd is an online shopping company trading in, Pretoria, South Africa. The company sells a wide variety of products online and delivers to customers in the Gauteng region. The company was...
-
Given this code fragment : if (lineSize) { alert ("There are " + lineSize + " people in line.") ; } else { alert ("The line is empty."); } a) If lineSize is 0, what's the output? b) If lineSize is 5,...
-
A project was tendered in 2 0 0 9 for US$ 3 . 5 million, when the exchange rate was US$ 1 . 0 3 1 5 per $C . It started building in 2 0 1 0 and the money was borrowed from the Canadian bank when the...
-
A uniformly charged ring of radius 10.0 cm has a total charge of 53.0 C. Find the electric field on the axis of the ring at the following distances from the center of the ring. (Choose the x-axis to...
-
An accomplished physical therapist stays in shape for her jdb by running on a track. She passes one marker running at 1.0 m/s, and continues to accelerate at 0.5 m/s for another 2.2 seconds. How far...
-
Chemist Stench Thiall, intending to prepare the disulfide A, has mixed one mole each of 1-butanethiol and 2-octanethiol with I 2 and base. Stench is surprised at the low yield of the desired compound...
-
Write a program to move a signed number from smaller register to bigger register. Hint: movzx ax, bl Topic: Data Related Operators and Directives in assembly language
-
An MBS is a financial __________ that gives the owner a partial interest in a pool of mortgage loans.
-
An investment generates $10,000 per year for 25 years. If you can earn 10 percent on other investments, what is the current value of this investment? If its current price is $120,000, should you buy...
-
A company has two investment possibilities, with the following cash inflows: If the firm can earn 7 percent in other investments, what is the present value of investments A and B? If each investment...
-
If you currently earn $50,000 and inflation continues at 4 percent for 10 years, how much must you make to maintain your purchasing power?
-
A firm with a 1 4 % WACC is evaluating two projects for this year's capital budget. After - tax cash flows, including depreciation, are as follows: 0 1 2 3 4 5 Project M - $ 1 5 , 0 0 0 $ 5 , 0 0 0 $...
-
Critically discuss the centralised distribution system with the decentralised distribution system. Which structure is more suitable for a large company. Support your arguments by referring to SCM...
-
Jules and Lin are married and filing jointly, with an adjusted gross income of $87,500. Determine the person's (or couple's) taxable income. Assume the standard deduction unless otherwise stated. Use...
Study smarter with the SolutionInn App