Which alternative would you choose in given case

Assignment Help Finance Basics
Reference no: EM132012685

Question: You are negotiating for the terms of a legal settlement, and your opponent's attorney has presented you with the following alternative settlement alternatives:

a. $38,000 today in one lump sum.

b. $50,000 to be paid to you in five equal payments of $10,000 at the end of each of the next five years.

c. Five equal annual installments of $9,100 each, beginning today.

If your discount rate is 10%, what is the present value of each of the alternatives and which alternative would you choose?

Reference no: EM132012685

Reviews

Write a Review

 

Finance Basics Questions & Answers

  Prepare a statement showing the budgeted for given year

Athena Ltd is an engineering business doing work for its customers to their particular requirements and specifications. It determines the full cost of each job taking a ‘job costing' approach, accounting for overheads on a departmental basis. It b..

  The rate of inflation for the next 12 months

The rate of inflation for the next 12 months (t=1) is expected to be 1.4 percent; it is expected to be 1.8 percent the following year (t=2); and 2.0 percent the following year (t=3).Assume that the real risk-free rate is 3 percent for all matu..

  Describe the kinds of securities the u.s. government uses

On January 15, 2020, the U.S. Treasury issued a 10-year inflation-indexed note with a coupon of 6%. On the date of issue, the CPI was 400. By January 15, 2030, the CPI had decreased to 300. What principal and coupon payment was made on January 15, 20..

  Valuing bonds the morgan corporation has two different

valuing bonds the morgan corporation has two different bonds currently outstanding. bond m has a face value of 30000

  Characteristics of the job

Question 1. ______ identifies characteristics of the job to be performed in terms of the tasks, duties and responsibilities to be fulfilled.

  The accounting manager of gateway inns has noted that every

the accounting manager of gateway inns has noted that every time the inns average occupancy rate increases by 5 percent

  Should not all pcaob members be taken from the investment

If auditing of financial statements is required for the protection of public investors, should not all PCAOB members be taken from the investment community that uses audited financial statements? Why or why not?

  Explain the role of organization culture in a company

Explain the role of Organization Culture in a company with regard to both the CEO and employees. How would organization culture be related to social responsibility?

  Identify the independent and dependent variables

Identify the independent and dependent variables and the levels of each of the factors, and indicate whether each factor is between participants or repeated measures.

  Determine the nations gross private domestic investment if

a nations gross domestic product gdp is 600 million. its personal consumption expenditures are 350 million and

  What was the risk premium on large- company stocks

Assume large-company stocks earned 11.4 percent over a period of years. Over that same period, the risk-free rate was 3.6 percent and the inflation rate was 3.2 percent. What was the risk premium on large- company stocks during this time period?

  What level of internal controls

What level of internal controls is consider to be adequate in a company? What are effective controls for cash and why are these controls.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd