Assume Your Uncle Will Pay You $100 for Each of the Next

question 28

Multiple Choice

Assume your uncle will pay you $100 for each of the next two years and $200 in years 3 and these amounts will be paid at year end.Assume the interest rate is 10% for the first two years and 12% for the next two (years 3 and 4) .What is your uncle's promise worth in today's dollars? (Round your answer)

• A)$317
• B)$342
• C)$453
• D)$512
• E)$600 100 (PVAnnuity_2,10%) + 200 (PVAnnuity_2,12%)((PV_2,10%)
• 100 (1.7355) + 200 (1.6901)(.8264)

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Definitions:

Commitment

A pledge or promise to do something or adhere to a certain course of action.

Group Members

Individuals who are part of a collective or organization, sharing common interests, goals, or characteristics.

Imposed Solution

A resolution to a disagreement or dispute that is dictated or enforced by an authority or external party, not by mutual agreement of the involved parties.

Mediation

A process where a neutral third party assists disputing parties in reaching a mutually acceptable agreement.