Eleni, Who Is Now 55 Years Old, Is Employed by a Firm

question 234

Multiple Choice

Eleni, who is now 55 years old, is employed by a firm that guarantees her a pension of $90,000/year at age 70. What is the present value of her first year's pension if inflation over the next 15 year(s) is at the given rate. Assume that inflation is continuously compounded. Round your answer to the nearest cent. ​
6% _________
​
9% _________
​
18% _________
​

• A) $64,219.68, $71,866.46, $6,048.50
• B) $36,591.27, $23,331.62, $6,048.50
• C) $57,386.53, $64,219.68, $6,048.50
• D) $57,386.53, $64,219.68, $71,866.46

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Definitions:

Promissory Estoppel

A rule in law that prohibits an individual from retracting a pledge given to another if the latter has justifiably depended on this assurance to their harm.

Quasi Estoppel

A legal doctrine preventing a party from asserting rights or facts that contradict their past actions or statements.

Bilateral Contract

A type of contract involving mutual obligations whereby each party promises to perform an act in exchange for the other party's act.

Promissory Estoppel

A legal principle that prevents a party from withdrawing a promise made to a second party if the latter has reasonably relied on that promise to their detriment.