In exchange for a lump sum payment now, Binghamton Pension Plan offers an annual pension over...

In exchange for a lump sum payment now, Binghamton Pension Plan offers an annual pension over thirty years beginning with a payment of $50,000 at the start of the first year. There are thirty payments in total and the payments will increase at an annual rate of 3% per year. The appropriate opportunity cost of funds is 6% per year. What is the amount of lump sum needed today to purchase the pension?

$1,015,054
$1,016,054
$1,018,054
$1,019,054
$1,020,054

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jeff jeffy answered 1 year ago

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