You wrote a piece of software that does a better job of allowing computers to ne

Question

You wrote a piece of software that does a better job of allowing computers to network than any other program designed for this purpose. A large networking company wants to incorporate your software into their systems and is offering to pay you $535,000 today, plus $535,000 at the end of each of the following six years for permission to do this. If the appropriate interest rate is 7 percent, what is the present value of the cash flow stream that the company is offering you? (Round answer to the nearest whole dollar, e.g. 5,275.)

Present Value $

Explanation / Answer

535000 + 535000/(1.07) + 535000/(1.07)^2 + 535000/(1.07)^3 + 535000/(1.07)^4 + 535000/(1.07)^5 + 535000/(1.07)^6

$ 3085098.72

Related Questions

Navigate

• Browse (All)
• Browse Y
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.