Part 2

You are juror in a workers compensation that a Glassboro citizen (George Costanza) has brought against Rowan University. Three years ago, GC (Short for Glassboro Citizen or George Costanza) was walking by Rowan and was hit on his head by a frustrated student who threw an insurance textbook out of the window in frustration The sheer force of the textbook on his head caused a concussion and he managed to read a few lines of the textbook which only aggravated the head injury. He has been fighting the case for three years. Finally, the judgment by you as a jury was to indemnify/compensate Glassboro Citizen, George Costanza with: 1. Future value, as of the award date, of three years of back pay ($50,000 per year) that he lost as he was out of work for three years and fighting this case 2. Present value of five years of future pay ($60,000) as he needs five years more to recover from the concussion, rehabilitate and find work This would indemnify him for wages that he had lost. Assume the relevant interest rate is 8.4% There was also a punitive damage for pain and suffering caused and reimbursement of legal fees. Let's ignore that for now. What is the closest answer to the present value of the indemnity award? 500,000 450,000 400,000 600,000 In the above question, George Costanza, the Glassboro Citizen would prefer the interest rate to be 10.4% not the originally used 8.4% True O False You are juror in a workers compensation that a Glassboro citizen (George Costanza) has brought against Rowan University. Three years ago, GC (Short for Glassboro Citizen or George Costanza) was walking by Rowan and was hit on his head by a frustrated student who threw an insurance textbook out of the window in frustration The sheer force of the textbook on his head caused a concussion and he managed to read a few lines of the textbook which only aggravated the head injury. He has been fighting the case for three years. Finally, the judgment by you as a jury was to indemnify/compensate Glassboro Citizen, George Costanza with: 1. Future value, as of the award date, of three years of back pay ($50,000 per year) that he lost as he was out of work for three years and fighting this case 2. Present value of five years of future pay ($60,000) as he needs five years more to recover from the concussion, rehabilitate and find work This would indemnify him for wages that he had lost. Assume the relevant interest rate is 8.4% There was also a punitive damage for pain and suffering caused and reimbursement of legal fees. Let's ignore that for now. What is the closest answer to the present value of the indemnity award? 500,000 450,000 400,000 600,000 In the above question, George Costanza, the Glassboro Citizen would prefer the interest rate to be 10.4% not the originally used 8.4% True O False