A dean at NYU has a guaranteed salary of $120, 000 at the end of each year for the next five years at which point they are scheduled to retire. The school would like the dean to retire now. How much should the school offer today? Suppose current interest rates are 1.5% at all maturities.

the school should offer $573,917.40 today.

Explanation:

The amount to be offered today is known as the Present Value and is calculated as :

Pmt =  $120, 000

Fv = $0

P/yr = 1

n = 5

r = 1.5%

Pv = ?

Using a Financial Calculator, the amount that the school should offer today, PV is $573,917.40.

the answer would be voluntary exchange -

"the act of buyers and sellers freely and willingly engaging in market transactions. moreover, transactions are made in such a way that both the buyer and the seller are better off after the exchange than before it occurred."

hope this : )

-shy

answer; ///pegged exchange rate with the united states;