Use the Following Information to Answer the Question(s)below

question 38

Multiple Choice

Use the following information to answer the question(s) below.
Frank Dewey Esquire from the firm of Dewey,Cheatum,and Howe,has been offered an upfront retainer of $30,000 to provide legal services over the next 12 months to Taggart Transcontinental.In return for this upfront payment,Taggart Transcontinental would have access to 8 hours of legal services from Frank for each of the next 12 months.Frank's normal billable rate is $250 per hour for legal services.
-Assuming that Dewey's cost of capital is 12% EAR,then the NPV of his retainer offer is closest to:

• A)-$7500.
• B)-$7400.
• C)$6000.
• D)$7400.

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Definitions:

Problem Avoiders

Individuals or entities that choose to ignore or evade challenges and issues rather than confronting and solving them.

Problem Solvers

Individuals or groups who focus on identifying issues and creating solutions to resolve them.

Multidimensional Thinking

The ability to consider and analyze issues from multiple perspectives and dimensions before making decisions.

Short Time Horizons

The focus on immediate or near-term outcomes and goals, often at the expense of long-term planning and sustainability.