1. A contract calls for a lump-sum payment of $15,000. Find the present value of the contract assuming. When making these calculations, you need to use a present value factor that is carried to three decimal places to get the correct answers. a. The payment is due in five years, and the current interest rate is 9 percent. Your answer should contain a dollar sign. b. The payment is due in ten years and the current interest rate is 5 percent. Your answer should contain a dollar sign. c. Between the two calculations, A and B, which option is the best option for the person receiving the payment? State in a full sentence why you chose this option.
1. A contract calls for a lump-sum payment of $15,000. Find the present value of the contract assuming. When making these calculations, you need to use a present value factor that is carried to three decimal places to get the correct answers. a. The payment is due in five years, and the current interest rate is 9 percent. Your answer should contain a dollar sign. b. The payment is due in ten years and the current interest rate is 5 percent. Your answer should contain a dollar sign. c. Between the two calculations, A and B, which option is the best option for the person receiving the payment? State in a full sentence why you chose this option.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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1. A contract calls for a lump-sum payment of $15,000. Find the present value of the contract assuming. When making these calculations, you need to use a present value factor that is carried to three decimal places to get the correct answers.
a. The payment is due in five years, and the current interest rate is 9 percent. Your answer should contain a dollar sign.
b. The payment is due in ten years and the current interest rate is 5 percent. Your answer should contain a dollar sign.
c. Between the two calculations, A and B, which option is the best option for the person receiving the payment? State in a full sentence why you chose this option.
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