A friend has been awarded a settlement in a law suit that specifies he be paid $30,000 at the start of each quarter for the next 6 years. Additionally at the end of year 6 he will receive a one-time payment of $500,000.00. He wishes to renegotiate this settlement to a single lump sum payment due today. If we assume that your friend can earn 8% per annum compounded quarterly on sums invested, what is the minimum amount that he should accept in the renegotiated settlement?

Answers

Answer 1

Based on the amount that your friend will be paid every quarter and the amount he will receive at the end of 6 years, the minimum amount he should take is $889,616.

What amount is the minimum your friend should accept?

The amount your friend will receive is constant so this is an annuity. It is an annuity due because it comes at the start of the period.

The minimum amount your friend should take is:

= Present value of annuity due + Present value of end of 6 year payment

The period is:                                                  The rate is:
= 6 years x 4 quarters                                     = 8% / 4 quarters

= 24 quarters                                                   = 2% per quarter

The minimum amount is:

= (Annuity x Present value of Annuity Due interest factor, 2%, 24 periods) + (500,000 x Present value factor, 2%, 24 periods)

= (30,000 x 19.2922) + (500,000 x 0.6217)

= $889,616

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Related Questions

explain about foreign trade payment system​

Answers

Answer:

The exporter's bank forwards the documents to the importer's bank. The importer's bank requests payment from the importer by presenting the documents. The importer makes payment and receives the documents and collects the goods. The importer's bank pays the exporter's bank and the exporter's bank pays the exporter.

bruin manufacturing has expected ebit of $26,000 in perpetuity. a tax rat 35% and debt equity ratio of 60 percent. the firm has $60,000 in outstanding debt at an interest rate of 8percent and its wacc is 12 percent. what is the value of the firm according to m&m proposition 1 with taxes?. should bruin change its debt-equity ratio if the goal is to maximize the value of the firm? explain.

Answers

The value of the firm according to M&M proposition 1 with taxes will be as follows,

WACC = .12 = (100/160)RE+ (60/160)(.08)(.65) ;RE= .1608

RE= .1608 = RU+ (RU– .08)(.6)(.65) ;RU= .1381

VU= EBIT(1 – t)/RU= ($26,000)(.65)/.1381 = $122,348.96

VL= VU+ Dt = $122,348.96 + .35D = $140,833.33

Or

VL= EBIT(1 – t)/WACC = ($26,000)(.65)/.12

= $140,833.33

What is M&M proposition?

Miller and Modigliani theory mentions two propositions. Proposition I state that the market value of any firm is independent of the amount of debt or equity in capital structure. Proposition II states that the cost of equity is directly related and incremental to the percentage of debt in the capital structure.

B) Applying M&M Proposition with tax the capitals, the firm has increased its value by issuing debt. As long as M&M Proposition holds, that is, there are no bankruptcy costs and so then the company should continue to increase its debt equity ratio to maximize the value of the firm.

Thus, the value of the firm according to M&M proposition 1 with taxes will be $140,833.33.

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What is TRUE about economic resources?
OA. Natural resources are limited, but manufactured resources are unlimited.
OB
All economic resources are limited.
OC. Company profit won't be impacted by the amount of resources used.
OD
Land is always limited, but labor is not limited.

Answers

Answer:

Im pretty sure its Natural resources are limited, but manufactured resources are unlimited.

Explanation:

Which accounts would be affected for the following transaction: "Received an invoice from a supplier for repair services performed, final payment due in two weeks"

Debit Bank; Credit Accounts Payable
Debit Repair Expense; Credit Accounts Payable
Debit Accounts Payable; Credit Bank
Debit Repair Expense; Credit Bank
Debit Owner, Capital; Credit Repairs Expense

Answers

Answer:

Debit Bank; Credit Accounts Payable

Debit Repair Expense; Credit Accounts Payable

Monetary policy is described as actions that influence the supply of ____________ and availability of ____________.

Answers

Answer:

Money, Credit

Explanation:

Monetary policy is described as actions that influence the supply of money in an economy. This in turn affects the availability of funds or credit in the economy.

What can a borrower do to take control of their debt? O A. The borrower can apply for more credit cards. O B. The borrower can create a payment plan. O C. The borrower can make only minimum payments. O D. The borrower can pay bills selectively.​

Answers

The thing a borrower can do to take control of their debt is The borrower can create a payment plan.

What is a debt?

Debt refers to amount money borrowed or things someone owed a person and promises to refund or return back when it is available.

A borrower borrowed from the lender and it is the borrower that is in debt.

Therefore, The thing a borrower can do to take control of their debt is The borrower can create a payment plan.

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Question 18
Equipment Company holds a lien on Fertile Farm's equipment. The
equipment can be sold to satisfy the debt

Answers

Answer:

if, before the sale, notice is given to Fertile Farm.

Explanation:

hope this helps you have a nice day :)

Create an oral presentation about yourself that will provide your interviewee with an accurate picture of your skills and preparations for your chosen career. Using the Voice Recorder tool, create this in the form of a personal commercial in which you advertise your attributes in terms of what you’ll need for the chosen profession

Answers

In creating a personal commercial, one have to give a conversational and natural oral presentation. One can start with:

Been confident, have a good poised, and been professional.

What is a personal commercial?

Others are:

Greet by saying: Hello, my name is (name). State your Goal, Interest and also your passion and others kind of attributes that can set you apart from others.

A personal commercial is known to be a short introduction that a person often give to a specific employer, mentor, or others.

Conclusively, By following the steps above, one can give a good  personal commercial.

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Corina has added animations to objects on a particular slide within a presentation. She needs to reorder the animations. How should she achieve this goal?

Use the Preview button.
Access the Advanced timeline.
Use the Animation pane.
Delete and recreate the animations in the correct order.

Answers

Corina has added animations to objects on a particular slide within a presentation. To reorder the animations, she can use the animation pane.

What do you mean by animations?

Animations refer to a method in which figures are manipulated that appear as moving images.

Corina has added animations to objects on a particular slide within a presentation. She needs to reorder the animations. She can achieve this goal by using the animation pane.

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Answer: c

Explanation:

In the case Blockchain Technology in Action: Walmart and Alibaba. Walmart is using Blockchain technology to improve what piece of their business?


Marketing


Supply Chain


HR

Answers

The improvement to their Walmart business forms the piece of their marketing.

What is Blockchain technology used for?

Walmart employed blockchain to create an automated system for managing invoices from and payments to its 70 third-party freight carriers.

Hence, the improvement to their business forms the piece of their marketing.

Therefore, the Option B is correct.

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Define marketing and the marketing concept.

Answers

Answer:

Marketing is the process of getting the right goods or services or ideas to the right people at the right place, time, and price, using the right promotion techniques and also utilizing the appropriate people to provide the customer service associated with goods, services, or ideas...

Nicole has lived in her home for thirty-five years. She is retired and receives a pension and Social Security. She no longer has loan payments on her house and has no major debts. She wants to live the rest of her life in her current house. Which financial situation could force Nicole to move her home unexpectedly? A. Her house could increase in value, making it difficult for her to afford to pay property taxes. B. A bank may try to foreclose on the house, making it necessary for her to move out of her home. C. Her Social Security could run out, making it hard for her to pay the costs of home ownership. D. Her house could decrease in value, reducing the amount that she earns from her pension.

Answers

Answer:

D.

Explanation:

pa brainliest po

Adidea Corp. bought 100 units at $15 each. The company then sold 30 units at $25 each, and 50 percent of the purchase was paid in cash. What amount will Adidea credit to the inventory account? A. $1,500 B. $750 C. $375 D. $45

Answers

Answer: Merchandise Inventory                          7,500

                  Cash in bank                                                  3,750

                  Accounts Payable      

Explanation:

$375 amount will Adidea credit to the inventory account. Thus option C is correct.

What is a company?

A company is a legal body created by a group of people to conduct and manage a multinational corporation, whether it be commercial or economic. The company's main aim is to earn a profit. Also, to make sure that they have enough finds to run the business in the near future.

The information that is provided is :

100 were purchased by Adidea Corp. for $15 a piece.

The business then sold 30 units for $25 each, with cash representing 50% of the total cost.

The total amount of commodities that are sold = 25 * 30

= 750

The Percentage that the commodity is paid in cash is 50%.

The amount that is paid in credit will be = 750 * 50 /100

= 375

Therefore, option C is the correct option.

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Janae has created a table of her company's revenue data. The company sells its products in four cities. Janae's manager told her to create a new
visual showing the share of revenue from each city. Complete the following sentences.
Janae should choose a
to show each city's contribution to the company's total revenue. This type of visual is especially
effective because it allows her to show the revenue from each city as a
of the company's total revenue.
Reset
Next? Does anyone know the answer

Answers

Answer:

First one is "Pie Chart"

Second one is "Percentage"

Explanation:

Enjoy

What are the disadvantages of indirect distribution network

Answers

The disadvantages of indirect distribution network is that more time and resources are used.

What is Indirect distribution network?

This involves selling wholesale products  to retailers so as to ensure the goods are distributed to the public.

This puts distance between the individual and customers which is why more time and resources are deployed so as to ensure it gets to its final destination.

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Before attending a job fair, you should contact the host to see if you can obtain a list of the employers registered for the event so you can prepare focused resume and cover letters to share with them.
A. True
B.False

Answers

Answer:

A. true

Explanation:

it is always good to be prepared

How are payday lenders different from a bank or credit union?

A. Payday lenders usually offer loans at a much lower rate than
banks and credit unions.
B. Payday lenders usually don't require collateral, unlike banks and
credit unions.
C. Payday lenders often offer loans to people who are unable to get a
loan from a bank or credit union.
D. Payday lenders often offer loans for a longer term than banks or
credit unions.

Answers

The difference between payday lenders and a bank or credit union is B. Payday lenders usually don't require collateral, unlike banks and credit unions.

What is payday lending?

Payday lending is a type of short-term borrowing where a borrower receives a high-interest credit based on personal income.

The characteristics of payday lending include:

Small-term loansSmall amounts of money are involvedAvailable at short noticeInterest rates are high.

Thus, the difference between payday lenders and a bank or credit union is B. Payday lenders usually don't require collateral, unlike banks and credit unions.

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Answer: the answer is C (PAYDAY LENDERS OFTEN OFFER LOANS TO PEOPLE WHO ARE UNABLE TO GET A LOAN FROM A BANK OR CREDIT UNION!!!)

Explanation: I just took the test!

Respond to the posts indicating your agreement or disagreement with their position and why. Feel free to bring in additional references to these reply posts.

Answers

The US would benefit from gaining access to the Euro zone market and look to expand business by taking advantages of cheap import prices in the Euro zone. While the US would benefit from importing goods from India, china and Japan owing to cheaper export prices to these countries.

What is import and export?

An export is the sale of goods to a foreign country, while an import is the purchase of foreign manufactured goods in the buyer's domestic market.

When a country is importing goods, this represents an outflow of funds from that country. Local companies are the importers, and they make payments to overseas entities, or the exporters.

A healthy economy is one where both exports and imports are experiencing growth. This typically indicates economic strength and a sustainable trade surplus or deficit.

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discuss the new product development concept​

Answers

Answer:

New product development (NPD) is the process of bringing a new product to the marketplace

Explanation:

1.2 Describe the demand curve

Answers

Answer:

demand curve, in economics, a graphic representation of the relationship between product price and the quantity of the product demanded. It is drawn with price on the vertical axis of the graph and quantity demanded on the horizontal axis.

Explanation:

Which of the following statements regarding coins is not true?

a. Coins are usually metal based.
b. Unlike paper money, the same coins are used in every country in the world.
C. The creation of coins is authorized by the government.
d. Coins are used as a form of money.

Answers

Answer:

B

Explanation:

every country have its own currency and coins

Almost every country has a unique currency, although some countries share common currencies

but take an example of India and US

both have different coins India have ruppes

and us have bucks

hope it helps you

Imagine you win $10,000 in a state competition and decide to invest your prize. First, determine your risk tolerance. Then, choose two investment options from the lesson for your money. Describe your investment plan in a detailed paragraph. Be sure to include responses to the following questions: • Why did you choose these two options? • How may taxes, fees, and inflation affect your investments? • How do your choices reflect your tolerance for risk? • How do you plan to divide your money between the two investment options you chose? Be sure to include the following terms in your explanation: o diversification o risk o rate of return o interest rate

Answers

Some possible investments that a person that won $10,000 make are:

CryptocurrenciesStocks

What is Risk Tolerance?

This refers to the ability of a person to be able to endure losses that can come from making an investment.

Hence, we can see that after making a good risk assessment to find the risk tolerance, if it is between medium to high, then it is advised to invest a good portion in cryptocurrencies and stocks and then put the remaining in a trust fund.

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Fill in the blank.

_______ researchers can be a costly aspects of starting a business. In most cases, you can find the information through your own efforts.

Most of the important information about your business will come from your _______.

It’s a good idea to research your _______ prices before setting your _______.

The _______ model is determined by adding a predetermined percentage to your cost.

A company website may be a _______ source of information but not a _______ one.

Answers

Paying market researchers can be a costly aspects of starting a business. In most cases, you can find the information through your own efforts.

What best complete the following?

Most of the important information about your business will come from your customers.

It’s a good idea to research your industry standard prices before setting your prices.

The cost contingency model is determined by adding a predetermined percentage to your cost.

A company website may be a secondary source of information but not a primary one.

What is a Market research?

Market research involves gathering and analyzing data on consumers and competitors. Market research studies market status to find potential sales of a product or service. It helps companies understand what products people want, who will buy them, and at what price.

Therefore, the correct answers are as given above.

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Answer:

1. Professional

2. research

3. competitor’s, own

4. cost plus

5. quick, reliable

Explanation: PF

Which of these is not one of the three uses of money?

a medium of exchange
a store of value
a means to barter
a unit of account

Answers

Answer:

The answer is means to barter. This is the obvious answer because barter means to exchange something without the use of money, so this answer would be a contradiction.

Explanation:

You have a great day, put God first, he's real and he loves you. My faceb account is Don Omega, hit me up over their. I'm 16 and live on Alabama.

what is trust ownership in real estate

Answers

Answer:

Explanation:

To create a trust, the property owner (called the "trustor," "grantor," or "settlor") transfers legal ownership to a family member, professional, or institution (called the "trustee") to manage that property for the benefit of another person (called the "beneficiary").

1.How and when do you use disposable gloves, and how often should you change them?

Answers

Answer:

when you don't want to get your hands messy like cleaning dishes and I saw the horse in your pf so mabey when braiding there hair or anything like that and theow away everytime u use them I'm not sure if that is the answer you were looking for but I hope so lol

finanicial accounting​

Answers

Answer:

financial accounting is a process of record,summarising and reporting a company's business transaction through financial statements.

Financial statement analysis is useful to:

Answers

Evaluate business performance and value

What should you do if your decision isn't working out and you have tried making adjustments

Answers

Alternative actions (if the decision is not working as intended): Give it more time: You need to make sure employees, customers, and so on have had enough time to get used to the new action. Change it slightly: Maybe the action was correct, but it just needs "tweaking"—a small change of some sort.

(hope it helps hehe ^^')

What role does weak financial regulation and supervision play in causing financial crises?

Answers

Weak regulation and supervision mean that financial institutions are at risk, especially if market behavior is weakened by the existence of a government safety net.

What are the causes and effects of a financial crisis?

The factors contributing to the financial crisis include systemic failure, unforeseen or uncontrollable human behavior, high-risk incentives, lack of control or failure, or infections that can spread the spread of virus-like problems from one institution or country to another.

Thus, this is the way weak financial regulation and supervision play in causing financial crises.

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Scientists use equations to model how fast a rocket needs to go to launch a satellite into orbit. What is a limitation of this model? The arctic fox is different from the brown fox. the color of the arctic foxs fur changes to brown during the summer. the fur remains white during winter. the arctic fox lives in snow-bound regions, while the brown fox lives in forests. which three ways do these adaptations enable both foxes to survive in their surroundings? photograph on the left shows an arctic fox on a snow-covered landscape and photograph on the right shows a brown fox in a forest. the brown color camouflages the arctic fox when snow melts during the summer. the white color camouflages the arctic fox during the winter. the brown color camouflages the brown fox in the forest. the white color camouflages the arctic fox when snow melts during the summer. the brown color camouflages the brown fox in snow-bound regions. please help please please help Brainliest, help me! 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