Question
Saban Football, Inc. agrees to sell their copyrighted football practice scheme to Les Miles for six annual payments of $150,000 at the end of each
Saban Football, Inc. agrees to sell their copyrighted football practice scheme to Les Miles for six annual payments of $150,000 at the end of each year, with the payment deferred 4 years. Given an annual interest rate of 8%, what is the present value of the six payments? Round to the nearest penny.
i= 8% periods
FV PV FVOA PVOA 1 1.08000 0.92593 1.00000 0.92593 2 1.16640 0.85734 2.08000 1.78326 3 1.25971 0.79383 3.24640 2.57710 4 1.36049 0.73503 4.50611 3.31213 5 1.46933 0.68058 5.86660 3.99271 6 1.58687 0.63017 7.33593 4.62288 7 1.71382 0.58349 8.92280 5.20637 8 1.85093 0.54027 10.63663 5.74664 10 2.15892 0.46319 14.48656 6.71008
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