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a. On May 15,2018 Rick Newlin reached a settlement on a long overdue contract. The...

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a. On May 15,2018 Rick Newlin reached a settlement on a long overdue contract. The settlement results in Rick receiving a total of $1,900,000 - - scheduled over 4 annual payments of $475,000 each. The first payment starts on May 15,2021 , with the remaining 3 payments following on May 15, 2022, May 15 , 2023 , and May 15,2024 Rick wants to know the present value of his settlement today on May 15, 2018, at a 6% interest rate. Show all calculations. b. Steve Thicket Corporation issued $3,500,0,00 of 4.25%10 year bonds. Interest is payable annually on the bonds, however, the company's CFO is concerned about having sufficient funds to pay back the bonds at the end of 10 years. Therefore, the cFo is establishing a "Bond Sinking Eund" by making annual deposits of $250,000 to the fund starting at the end of the first year and continuing through the end of the 10 th year. The fund is projected to provide a return of 6% per year. Will the CFO's planned deposits be sufficient to meet the obligation? If the planned deposits are insufficient, how much should the annual deposit be increased by in order to meet the obligation? Show all calculations

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