Julios attorney negotiates a structured settlement after an injury, consisting of seven equal payments to Barry of

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Julio’s attorney negotiates a structured settlement after an injury, consisting of seven equal payments to Barry of $150,000 each. The first payment is due today, and the remaining payments will be received in annual amounts, with the second payment occurring one year from now. What is the approximate value of this settlement in today’s dollars if Barry uses a discount rate of 5%? 

a. $911,352

b. $867,960

c. $746,235

d. $1,050,000

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Principles Of Finance

ISBN: 9798439388899

1st Edition

Authors: Julie Dahlquist, Rainford Knight

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