Question

Your first job out of college will pay you $59,000 in year 1 (exactly one year from today), growing at a rate of 3.1% per year thereafter. You will also receive a one time bonus of $37,000 at the same time as your first salary. You plan to retire in 39 years (you'll receive 39 years of salary). If the applicable discount rate is 6%, what is the present value of these future earnings today? Round to the nearest cent.

Answer 1

The correct answer is : $ 1,379,763.07

Note:

Year	Salary	Discounting Factor ( 6%)	(Present Value = Salary * Discounting Factor)
1	96,000.000000000	0.943396226	90,566.037735849
2	60,829.000000000	0.889996440	54,137.593449626
3	62,714.699000000	0.839619283	52,656.470609967
4	64,658.854669000	0.792093663	51,215.869055543
5	66,663.279163739	0.747258173	49,814.680185156
6	68,729.840817815	0.704960540	48,451.825727260
7	70,860.465883167	0.665057114	47,126.256910193
8	73,057.140325545	0.627412371	45,836.953655103
9	75,321.911675637	0.591898464	44,582.923790954
10	77,656.890937582	0.558394777	43,363.202291013
11	80,064.254556647	0.526787525	42,176.850530221
12	82,546.246447903	0.496969364	41,022.955562885
13	85,105.180087788	0.468839022	39,900.629420127
14	87,743.440670510	0.442300964	38,809.008426557
15	90,463.487331295	0.417265061	37,747.252535642
16	93,267.855438565	0.393646284	36,714.544683252
17	96,159.158957161	0.371364419	35,710.090158898
18	99,140.092884833	0.350343791	34,733.115994174
19	1,02,213.435764263	0.330513010	33,782.870367918
20	1,05,382.052272955	0.311804727	32,858.622027664
21	1,08,648.895893416	0.294155403	31,959.659726907
22	1,12,017.011666112	0.277505097	31,085.291677775
23	1,15,489.539027762	0.261797261	30,234.845018666
24	1,19,069.714737622	0.246978548	29,407.665296457
25	1,22,760.875894489	0.232998631	28,603.115962875
26	1,26,566.463047218	0.219810029	27,820.577884645
27	1,30,490.023401682	0.207367952	27,059.448867046
28	1,34,535.214127134	0.195630143	26,319.143190495
29	1,38,705.805765075	0.184556739	25,599.091159812
30	1,43,005.685743792	0.174110131	24,898.738665817
31	1,47,438.862001850	0.164254840	24,217.546758922
32	1,52,009.466723907	0.154957397	23,554.991234385
33	1,56,721.760192348	0.146186223	22,910.562228916
34	1,61,580.134758311	0.137911531	22,283.763828314
35	1,66,589.118935819	0.130105218	21,674.113685841
36	1,71,753.381622829	0.122740772	21,081.142651040
37	1,77,077.736453137	0.115793181	20,504.394408700
38	1,82,567.146283184	0.109238850	19,943.425127707
39	1,88,226.727817962	0.103055519	19,397.803119496
			13,79,763.073611810