Mr. Warren Buffet, the second richest man in the world, in June 2006 decided to donate 85% of his $44 billion fortune to Bill & Melinda Gates foundation in installments of $ 1.5 billion every year. Mr. Buffet stipulated that the annual payments must be distributed to the beneficiaries within a year before the subsequent payment is made. If Mr. Buffet did not stipulate the condition and instead, Gates Foundation decided to invest the annual contribution at 8% and spend the aggregate sum only upon receiving the entire contribution promised, what amount will the foundation have at the end?
Mr. Warren Buffet, the second richest man in the world, in June 2006 decided to donate 85% of his $44 billion fortune to Bill & Melinda Gates foundation in installments of $ 1.5 billion every year. Mr. Buffet stipulated that the annual payments must be distributed to the beneficiaries within a year before the subsequent payment is made. If Mr. Buffet did not stipulate the condition and instead, Gates Foundation decided to invest the annual contribution at 8% and spend the aggregate sum only upon receiving the entire contribution promised, what amount will the foundation have at the end?
Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)
7th Edition
ISBN:9780357033609
Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Chapter15: Preserving Your Estate
Section: Chapter Questions
Problem 9FPE
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Mr. Warren Buffet, the second richest man in the world, in June 2006 decided to donate 85% of his $44 billion fortune to Bill & Melinda Gates foundation in installments of $ 1.5 billion every year. Mr. Buffet stipulated that the annual payments must be distributed to the beneficiaries within a year before the subsequent payment is made. If Mr. Buffet did not stipulate the condition and instead, Gates Foundation decided to invest the annual contribution at 8% and spend the aggregate sum only upon receiving the entire contribution promised, what amount will the foundation have at the end?
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