An Insurance Settlement Offer Includes Annual Payments of $36,000,$42,000,and $50,000

question 14

Multiple Choice

An insurance settlement offer includes annual payments of $36,000,$42,000,and $50,000 over the next three years,respectively,with the first payment being made one year from today.What is the minimum amount you should accept today as a lump sum settlement if your discount rate is 7 percent?

• A)$119,877.67
• B)$111,144.18
• C)$105,000.10
• D)$118,924.27
• E)$114,556.88

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Definitions:

Social Roles

The parts individuals play as members of a social group, which meet the expectations of society.

Deliberation

The process of carefully considering or discussing something before making a decision or forming an opinion.

Disobey Orders

The act of intentionally not following commands, rules, or instructions given by someone in authority.

Milgram Study

A series of social psychology experiments conducted by Stanley Milgram, which measured the willingness of study participants to obey an authority figure who instructed them to perform acts conflicting with their personal conscience.