Ben sold his small online business for $100,000. The purchaser will pay him $20,000 today, then $20,000 every year for the next four years. Assume that Ben could invest a lump-sum payment today in an account yielding an interest rate of 4% annually. Find the total present value of all five payments. A.
$87,096
B.
$88,384
C.
$92,598
D.
$93,964

c. 92,598

Step-by-step explanation:

20000 + 20000/1.04 + 20000/(1.04^2) + 20000/(1.04^3) + 20000/(1.04^4)= 20000 + 19230.77 + 18491.12 + 17779.73 + 17096.08

= 92597.

= 92,598

yes

step-by-step explanation:

yes, gavin is right.

step-by-step explanation:

gavin is correct. 

this problem is about converting 9% per year to how many percent per quarter. the rate is still the same. it only differed in the time period. so, through dimensional analysis,

9% per year  × (1 year / 4 quarters) = 2.25% per quarter

if he was asked to convert 9% per year to how many percent per quarter  compounded quarterly, then you will not simply divide by four. this is because compounding is not linear.

hope this , have a good day. c;