Problem on canceling the contract

Reference no: EM131788036

Question: Kelly Greene has a contract in which she will receive the following payments for the next five years: $3,000, $4,000, $5,000, $6,000, and $7,000. She will then receive an annuity of $9,000 a year from the end of the 6th through the end of the 15th year. The appropriate discount rate is 13 percent. If she is offered $40,000 to cancel the contract, should she do it?

Reference no: EM131788036

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