Your parents have made you two offers. The first offer includes annual gifts of $10,000, $11,000, and $12,000 at the end of each of the next three years, respectively. The other offer is the payment of one lump sum amount today. You are trying to decide which offer to accept given the fact that your discount rate is 8 percent. What is the minimum amount that you will accept today if you are to select the lump sum offer?

$28,216

Explanation:

The computation of the minimum amount that you will accept today i.e present value is shown below:

Year            Cash flows          Discount factor                Present value

1                   $10,000.000.9259259259           $9,259.26

2                  $11,000.00         0.8573388203           $9,430.73

3                  $12,000.000.793832241                   $9,525.99

Total present value                                                          $28,215.97

The discount factor should be computed by  

= 1 ÷ (1 + rate)^years

answer: a. the kind of population living in your neighbourhood.

the census explorer data tool by the us census bureau allows the user to zoom in on any neighbourhood within the united states and find the kind of people residing in that by race and age.  

the tool needs to needs to be used twice – once in order to find what type of people reside in a neighbourhood, and then to see the age groups of the people in the same neighbourhood.

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