questions 6-8

Question 6 Stephen Downs was severely injured In a motorcycle accident and will spend the rest of his life In a wheelchair. He successfully sued the party responsible. You, as a member of the jury, are trying to decide what Stephen should receive as a settlement. One part of the settlement is to determine the value of his lost wages. You have determined that Stephen will lose $4,800 a month In wages for the next 35 years because of the accident. Assuming that money Is worth 6.35% compounded monthly and the $4,800 would have been received at the end of each month, what Is a fair settlement? $808,237.20 $2,016,000 $812,514.12 $152,991.95 Question 7 You leased retail space 12 years ago for $6,450 per month, payable at the beginning of each month. Your lease is for 20 years and allows you to sublease the space. You have decided to move your business to another location and sublease to That Pagoda Palace for $8,500 at the beginning of each month for the remainder of the lease. What is the value of your position (referred to as a leasehold interest), assuming that money is worth 6.7% compounded monthly? $152,021.83 $633,853.79 $152,870.62 $630,334.42 Question 8 Paul Is a 43-year-old construction worker and decides to start a retirement plan. He figures his Income for the next 10 years will be sufficient to deposit $1,000 at the end of each quarter into his retirement plan earning 7.8% compounded quarterly. After 10 years, he will let the money sit for another 13 years, without making additional deposits, until he is 66 years old. What amount will Paul have when he turns 66? $353,162.56 $163,111 83 $251,821.18 $43,120 Question 9 Suppose that Carnegie Steel Corporation set aside $245,000 at the end of each quarter for 14 years Into a special fund to use for environmental clean-up costs. The fund earns 7.65%% compounded quarterly. For the next 6 years, the company Increased its deposits to $350.000 per quarter. Find the amount In this account at the end of the 20-year period. $40,682,952.92 $11,549,846.73 e $48,662,377.65 $29,314,030.00 O