Jorge Dow turned 65 today. His grandfather established a trust fund that will pay Mr....
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Jorge Dow turned 65 today. His grandfather established a trust fund that will pay Mr. Dow $85,000 on his next birthday. Unfortunately, Mr. Dow needs money today to start his retirement fund, and his grandfather is willing to help. He has agreed to give Mr. Dow the present value of the future cash inflow, assuming 8 percent rate of return. What is the amount of cash that Mr. Dow's father should give him?
Multiple Choice
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$68,950
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$78,704
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$62,109
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$85,000
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