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Your grandfather would like to share some of his fortune with you. He offers to give you money under one of the following scenarios (you
Your grandfather would like to share some of his fortune with you. He offers to give you money under one of the following scenarios (you get to choose): 1. $8,550 per year at the end of each of the next six years 2. $50,250 (lump sum) now 3. $98,150 (lump sum) six years from now (Click the icon to view Present Value of $1 table.) (Click the icon to view Present Value of Ordinary Annuity of $1 table.) Read the Requirement 1. Calculate the present value of each scenario using an 8% discount rate. Which scenario yields the highest present value? (Round the factors to three decimal places, X. XXX. Round the present value to the nearest whole dollar.) Scenario 1, 8% discount rate, Present value = Reference Requirements 1. Calculate the present value of each scenario using an 8% discount rate. Which scehario yields the highest present value? Round to the nearest whole dollar. 2. Would your preference change if you used a 12% discount rate? Reference
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