At a military base in Texas, Corporal Stan Moneymaker has been offered a wonderful savings...
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At a military base in Texas, Corporal Stan Moneymaker has been offered a wonderful savings plan. These are the salesperson's words: "During your 44-month tour of duty, you will invest $180 per month for the first 41 months. We will make the 42th, 43th, and 44th payments of $180 each for you. When you leave the service, we will pay you $8100 cash." Is this a good deal for Corporal Moneymaker? Use the IRR method in developing your answer. Stan makes the assumption that the investment firm will pay him $8100 when he leaves the service at the end of 44 months (i.e., there is little risk involved).
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