Question
Your father offers you a choice of $120,000 in 13 years or $47,000 today. Use Appendix B as an approximate answer, but calculate your final
Your father offers you a choice of $120,000 in 13 years or $47,000 today. Use Appendix B as an approximate answer, but calculate your final answer using the formula and financial calculator methods.
a-1. If money is discounted at 8 percent, what is the present value of the $120,000?
b-1. Now assume the offer is $120,000 in 10 years or $47,000 today. What is the present value of the $120,000 at 8 percent for 10 years?
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Foundations of Financial Management
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen
15th edition
77861612, 1259194078, 978-0077861612, 978-1259194078
