Red Sun Rising Corp. has just signed a lease for its new manufacturing facility. The lease agreement calls for annual payments of $1,100,000 for 20 years with the first payment due today. If the interest rate is 3.25 percent, what is the value of this liability today?

The value of Liability is $15,993,281

Explanation:

Red Sun Rising Corp. is making annuity Payment of $1,100,000 for a period of 20 years. The value of this liability can be calculated by taking net present value of all future cashflows.

Present value of Annuity = P [ 1 - ( ( 1 + r )^-n ) / r ]

Present value of Annuity = $1,100,000 [ 1 - ( ( 1 + 3.25% )^-20 ) / 3.25% ]

Present value of Annuity = $1,100,000 [ 1 - ( ( 1 + 0.0325 )^-20 ) / 0.0325 ]

Present value of Annuity = $1,100,000 [ 1 - ( ( 1.0325 )^-20 ) / 0.0325 ]

Present value of Annuity = $15,993,280.76

the correct answer option is b. a single paragraph.

explanation:

when you are thinking about paragraph​ topics, you should always choose a subject that can be adequately addressed in a single paragraph.

a paragraph is a piece of writing consisting of a few sentences that deal with a single theme. it has only a single idea that the paragraph revolves around and talks about.

so a paragraph topic must be chosen wisely where a single idea can be communicated in a single paragraph.