A downtown bank promises its potential employees a $ 8000 sign-on bonus, an additional bonus of $ 12000 two years from now, an additional bonus of $ 19000 four years from now, and an additional bonus of $ 23000 six years from now. Lavanya was hired today but only intends to work for this bank for three years. What is the present value of this bonus payment structure to her? (Assume that money is worth 8% p.a. compounded quarterly)

A downtown bank promises its potential employees a $ 8000 sign-on bonus, an additional bonus of $ 12000 two years from now, an additional bonus of $ 19000 four years from now, and an additional bonus of $ 23000 six years from now. Lavanya was hired today but only intends to work for this bank for three years. What is the present value of this bonus payment structure to her? (Assume that money is worth 8% p.a. compounded quarterly)

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 22P

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A downtown bank promises its potential employees a $9000 sign-on bonus, an additional bonus of $ 13000 two years from now, an additional bonus of $ 16000 four years from now, and an additional bonus of $ 21000 six years from now. Lavanya was hired today but only intends to work for this bank for three years. What is the present value of this bonus payment structure to her? (Assume that money is worth 8% p.a. compounded quarterly) O a. $18235.66 O b. $ 20235.80 O c. $19411.07 O d. $ 20095.37 O e. $ 20449.97
A downtown bank promises its potential employees a $ 5000 sign-on bonus, an additional bonus of $11000 two years from now, an additional bonus of $ 17000 four years from now, and an additional bonus of $ 24000 six years from now. Lavanya was hired today but only intends to work for this bank for one year. What is the present value of this bonus payment structure to her? (Assume that money is worth 8% p.a. compounded quarterly) O a. $ 4439.85 O b. $ 4869.73 O c. $ 4619.23 O d. $ 4101.74 O e. $ 5000.00
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