Imprudential, Inc. has an unfunded pension liability of $627 million that must be paid in 21 years. To assess the value of the firm's stock, financial analysts want to discount this liability back to the present. The relevant discount rate is 7.38 percent. What is the present value of this liability?

$140,564,661    

Explanation:

The formula and the computation of the present value of this liability is shown below:

As we know that

Future value = Present value × (1 + interest rate)^number of years

where,

Future value = $627,000,000

Interest rate = 7.38%

And, the number of years = 21

So, the present value is

$627,000,000 = Present value × (1 + 7.38%)^21

So, the present value is

= $627,000,000 ÷ 4.4606

=  $140,564,661

say it in english maybe we can

the definition of a small business is an independently owned and operated company that is limited in size and in revenue depending on the industry. a local bakery that employs 10 people is an example of a small business. a manufacturing facility that employees less than 500 people is an example of a small business.