You will receive annual payments of $15,000 for the next 25 years. You would like to...

You will receive annual payments of $15,000 for the next 25 years. You would like to have your money today instead of waiting of waiting 25 years to receive it all. What is the equivalent value of this future stream of payments if the appropriate discount rate is 8%?

A. 148,421.91

B. 160,121.64

C. 183,926.48

D. 201,448.72

Expert Solution

Annual payments = $15,000

Received for 25 years

Discount rate = 8%

Present value of annual payments is

= $15,000 * PVAF(8% , 25 years)

= $15,000 * 10.674776

= $160,121.64

or

jeff jeffy answered 2 months ago

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