Question: Don Draper has signed a contract that will pay him $ 70 comma 000 at the end of each year for the next 7 years,

Don Draper has signed a contract that will pay him

$ 70 comma 000

at the end of each year for the next

7

years, plus an additional

$ 100 comma 000

at the end of year

7

.

If

8

percent is the appropriate discount rate, what is the present value of this contract?

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