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Which of the following comes closest to the equivalent

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Question 1

Doug just received a settlement from a lawsuit that pays him $125,000 immediately, followed by amounts of $125,000 at the end of each year over the next 10 years with one exception - lawyer fees reduce the amount in Year 3 to $75,000. However, the lawsuit allows Doug to receive the equivalent present value today. Using an interest rate of 6.5%, which of the following comes closest to the equivalent present value?

a. $1,200,000
b. $ 666,666
c. $ 982,211
d. $ 898,604
e. $ 857,145 

Reference no: EM131100210

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