Question
As a result of a slowdown in operations, Tradewind Stores is offering employees who have been terminated a severance package of $107,000 cash paid today;
As a result of a slowdown in operations, Tradewind Stores is offering employees who have been terminated a severance package of $107,000 cash paid today; $107,000 to be paid in one year; and an annuity of $39,000 to be paid each year for 5 years.
What is the present value of the package assuming an interest rate of 10 percent?
( Round the final answer to nearest whole dollar.)
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Cornerstones of Cost Management
Authors: Don R. Hansen, Maryanne M. Mowen
2nd edition
1111824401, 978-1111824402
