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Question #4 Gabry Ponte has a contract in which he will receive the following payments for the next five years: $14,000, $15,000, $16,000, $17,000,

  

Question #4 Gabry Ponte has a contract in which he will receive the following payments for the next five years: $14,000, $15,000, $16,000, $17,000, $18,000. Gabry will then receive an annuity of $21,500 a year from the end of the sixth year through the end of the fifteenth year. The appropriate discount rate is 18 percent. a. What is the present value of all future payments? (Use a Financial calculator or Excel to arrive at the answer. Round the final answer to the nearest dollar amount.) Present value $ b. If he is offered a buyout of the contract for $43,000, should he do it? Yes O No

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