denali9696
Apr 24, 2008, 05:52 PM
Hello,
Can someone please assist me in the following question.
Your uncle has given you three alternatives for your inheritance. You can have $10,000 now; $2,000 per year for the next eight years; or $24,000 at the end of eight years. Which inheritance alternative would be best and why? The discount rate is 6% (Explain your answer fully)
My choice would be the 24K at the end of 8 years because I would then receive $38,252 vs. the 10K now or the 2k per year which would only be 16k at the end of the eight years.
Please let me know if I am on the right track.
Can someone please assist me in the following question.
Your uncle has given you three alternatives for your inheritance. You can have $10,000 now; $2,000 per year for the next eight years; or $24,000 at the end of eight years. Which inheritance alternative would be best and why? The discount rate is 6% (Explain your answer fully)
My choice would be the 24K at the end of 8 years because I would then receive $38,252 vs. the 10K now or the 2k per year which would only be 16k at the end of the eight years.
Please let me know if I am on the right track.