Carol Thomas Will Pay Out $6,000 at the End of the Year

question 83

Multiple Choice

Carol Thomas will pay out $6,000 at the end of the year 2, $8,000 at the end of year 3, and receive $10,000 at the end of year 4. With an interest rate of 13 percent, what is the net value of the payments vs. receipts in today's dollars?

• A) $7,326.
• B) $10,242.
• C) $16,372.
• D) $4,112.

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Definitions:

Nonbreaching Party

In a contract, the nonbreaching party is the entity that has not violated any terms of the agreement.

Court

A legal institution where disputes are resolved, laws are interpreted, and justice is administered.

Contract Price

The agreed upon sum of money that a buyer will pay to a seller in exchange for the fulfillment of a service or delivery of a good.

Express Condition

A clearly defined and articulated term or stipulation within a contract that must be met for the contract to be fulfilled.