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Helen Martin just learned that she received an inheritance from her grandmother. The inheritance provides for Helen to receive $5400 per year at the end
Helen Martin just learned that she received an inheritance from her grandmother. The inheritance provides for Helen to receive $5400 per year at the end of the year for each of the next 6 years. Assuming a discount rate of 11%, what is the value of this inheritance to Helen today?
Type of Cash Flow | Periods | Interest Rate | Factor |
---|---|---|---|
PV of $1 | 6 | 11% | 0.5346 |
FV of $1 | 6 | 11% | 1.8704 |
PV ordinary annuity | 6 | 11% | 4.2305 |
FV ordinary annuity | 6 | 11% | 7.9129 |
PV annuity due | 6 | 11% | 4.6959 |
a. $25358
b. $42730
c. $22845
d. $19958
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