What is the present value of the package

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Reference no: EM131970590

Problem

As a result of a slowdown in operations, Tradewind Stores is offering employees who have been terminated a severance package of $90,000 cash paid today; $90,000 to be paid in one year; and an annuity of $31,000 to be paid each year for 4 years.

What is the present value of the package assuming an interest rate of 11 percent?

Reference no: EM131970590

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