Homework Answers
Value = Present value of all the annual payments discounted at 5.9%
Value = 2600000/(1+0.059)^1 + 2600000/(1+0.059)^2 + 2600000/(1+0.059)^3 + 2600000/(1+0.059)^4 + 2600000/(1+0.059)^5 + 2600000/(1+0.059)^6 + 2600000/(1+0.059)^7 + 2600000/(1+0.059)^8 + ............. 2600000/(1+0.059)^29 + 2600000/(1+0.059)^30
Value = $36174788.79 Answer
The third option is correct.
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