Bob currently owes Lemonade Inc. $6,000 on his tab. Bob thinks his part-time job will allow...

  

Transcribed Image Text:

Bob currently owes Lemonade Inc. $6,000 on his tab. Bob thinks his part-time job will allow him to pay back his tab if he pays $1,500 per year each year over the next 5 years. Assuming Lemonade Inc.'s WACC is 10%, what is the value today of $1,500 per year, each year, for 5 years (select the closest $$ amount)? Bob currently owes Lemonade Inc. $6,000 on his tab. Bob thinks his part-time job will allow him to pay back his tab if he pays $1,500 per year each year over the next 5 years. Assuming Lemonade Inc.'s WACC is 10%, what is the value today of $1,500 per year, each year, for 5 years (select the closest $$ amount)?

Answer rating: 100% (QA)

To find the present value of the stream of 1500 payments each year for 5 years we first ... View the full answer