ouwen tie lobery and must decide how to take the payout. Uso a 10% discount rate

Question

ouwen tie lobery and must decide how to take the payout. Uso a 10% discount rate what is the present value of$14,000 a year rece ed at the end of each of the next feyears? E (Click the ioon to view the present value of $1 table.) (Click the loon to view the present value of annuity of $1 table.) Data Table A $53,074 B. $70,000 C $8,694 D. $108,108 Present Value of $1 Perods 8% 0.681 0.630 0.583 0.540 0.500 10% 0.621 0.564 0513 0.467 0424 0.360 12% 0.567 0.507 0.452 0.404 0.361 0.322 6% 0.822 0.790 0.760 0.731 0.703 0.670 0 747 0.7 .68 0.627 0.592 706 Oson 1 0463 0300 i 10 0 Data Table Present Value of Annuity of $ as 12% 3.806 8% 3.993 4.623 5.200 5.747 10% 3.791 4 355 4 608 335 5.759 6 145 6% 4 212 Periods 4.452 5.242 6.002 5.582 6.210 6.802 7.360 4.504 4.963 5.328 5 650 7 435 6.710 lick to select your answer

Explanation / Answer

Calculation of present value:

Present value= Future value* Present value of annuity of $1 at the rate of 10% for 5 years

                    =14000*3.791=$53074

So correct answer is A)$53074

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