Calculate the Present Value of a Growing Annuity Given the Following

question 249

Multiple Choice

Calculate the present value of a growing annuity given the following information: current cash flows: $220,000; cash flow growth rate = 5%; timeframe = 55 years; required rate of return = 12%.

• A) $3,252,545
• B) $3,152,545
• C) $3,052,545
• D) $2,952,545
• E) $2,852,545

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Definitions:

Offeree

Offeree is a legal term referring to the party to whom an offer is made in contract law, who can then accept, reject, or counteroffer.

Requested Act

A specific action or operation that someone asks or formally requires someone else to perform.

Title Deeds

Legal documents proving ownership of property or land.

Acceptance

In contract law, it is the expression of assent to the terms of an offer in such a manner that binds both the offeror and offeree to a contract.