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A plaintiff in a high profile legal suit was offered the following out of court settlement: We the defendent will pay the lump sum of
A plaintiff in a high profile legal suit was offered the following out of court settlement: We the defendent will pay the lump sum of $130 to the plaintiff in exactly 12 years. Or, alternatively, we will negotiate a lump sum payment today. According to time value of money, what lump sum amount today will have the same present value as the offered settlement if the interest rate of 7.75%?
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