An inventor who we will call Jack has developed an exciting new process for producing an infinite supply of energy from salt water. Jack believes that he can sell his invention to a major oil company. Jack is asking for a Royalty of $5 Million dollars, payable at the end of year one and then increasing at the rate of 5% per year forever. If an appropriate discount rate is 15%, how much should Jack accept if the company wants to pay him a lump sum amount today?

Select one:

a. $33.3 Million

b. $50 Million

c. $500 Million

d. There is no correct answer given.