Question
Do you remember Christmas Vacation with Clark Griswold and Cousin Eddie? A Christmas classic. Well both Clark and Eddie were entrepreneurs. I know it is
Do you remember Christmas Vacation with Clark Griswold and Cousin Eddie? A Christmas classic.
Well both Clark and Eddie were entrepreneurs. I know it is a bit late for Christmas. This can be a fun problem to solve and I will give partial credit if you get some ideas correct. The more you document in the answer the better.
Read carefully. There are details here that you don't want to miss. Make a timeline.
Cousin Eddie has offered to buy Uncle Clark Griswold's business on Christmas Day of 2022 by making five payments of $18,600 on each Christmas Day for five years starting in 2024. Uncle Clark can invest for 8.1% per year (which he views as his cost of capital).
What should Clark expect Cousin Eddie's offer to be worth to him (Clark) today?
(Cousin Eddie is good for it as he sold his RV and has money in the bank to pay the annual amounts to Uncle Clark; Remember to draw your timeline showing the timing of payments. Read carefully the information provided. You may email me a screen shot or notes or any information that shows how you came to your answer for partial or total credit.)
Group of answer choices
$68,055
$68,519
$63,385
$74,069
$80,068
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