Question

You are considering a 3-year job offer. The job offers an annual salary of $48,000, $51,000, and $55,000 a year for the next three years, respectively. The offer also includes a starting bonus of $2,500 payable immediately. What is this offer worth to you today at a discount rate of 6.5 percent

Answer 1

$138,066.75

Step-by-step explanation:

The computation is shown below:

Year Cash Flows PVF at 6.5% Present Value

0 $2,500 1 $2,500.00

1 $48,000 0.938967136 $45,070.42

2 $51,000 0.881659283 $44,964.62

3 $55,000 0.827849092 $45,531.70

Total $138,066.75