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Suppose that you will receive annual payments of $18,500 for a period of 10 years. The first payment will be made 8 years froWhat is the correct answer?

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Answer #1

Calculating Present Value at the end of Year 8,

PV = [FV = 0, PMT = 18,500, N = 10, I = 0.06]

PV = $136,161,61

Present Value today = 136,161.61/(1.06)7

Present Value = $90,555.25

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