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Carla is ready to retire and has a choice of three pension plans. Plan A provides for an immediate cash payment of $376,000. Plan B
Carla is ready to retire and has a choice of three pension plans. Plan A provides for an immediate cash payment of $376,000. Plan B provides for the payment of $42,800 per year for 7 years and the payment of $214,000 at the end of year 7. Plan C will pay $32,500 per year for 7 years. Carla desires a return of 7 percent. Click here to view factor tables Determine the present value of each plan. (Round present value factor calculations to 4 decimal places, e.g. 1.2151 and final answers to 2 decimal places, e.g. 125.25. Enter negative amounts using either a negative sign preceding the number e.g. -45.12 or parentheses e.g. (45.12).) Present value Plan A $ Plan B $ Plan C $ Select the best one. Plan A Plan B Plan C is the best one.
Carla is ready to retire and has a choice of three pension plans. Plan A provides for an immediate cash payment of $376,000. Plan B provides for the payment of $42,800 per year for 7 years and the payment of $214,000 at the end of year 7. Plan C will pay $32,500 per year for 7 years. Carla desires a return of 7 percent.
Click here to view factor tables
Determine the present value of each plan. (Round present value factor calculations to 4 decimal places, e.g. 1.2151 and final answers to 2 decimal places, e.g. 125.25. Enter negative amounts using either a negative sign preceding the number e.g. -45.12 or parentheses e.g. (45.12).)
Present value
Plan A $
Plan B $
Plan C $
Select the best one.
Plan A
Plan B
Plan C
is the best one.
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