Determine what fair amount contractor should receive

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Reference no: EM13309802

A contractor was offered a contract whereby she would be paid in 36 equal monthly installments of $5,500, with the first payment made at the end of this month. She would rather be paid in a different pattern, but one that is of "equivalent" value to the monthly payment pattern. Determine what fair amount she should receive if she decides she want to be paid:

a. In 2 equal installments - one immediately (at T=0) and one at the end of month 36.

b. In 1 full amount, at the end of month 18 (the half-way point) of the contract.

c. In 8 equal installments - the first 4 at the end of the first 4 months of the contract, and 4 installments at the end of the last 4 months of the contract.

d. In an arithmetic gradient pattern, over the entire 36 months.

Reference no: EM13309802

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