Question

You are the fore person of a jury charged with determining the amount of damages to...

You are the fore person of a jury charged with determining the amount of damages to pay to a plaintiff who was injured at work due to her employer’s negligence. Because of her injuries, she lost the previous two years’ salaries ($3,000 per month for the first year and $3,200 per month for the most recent year) and is expected to lose $3,500 per month for the next five years after today.

a. What is the amount of the award you would recommend she receive if the interest rate used to determine the award is 9.0%, compounded monthly? Please calculate today’s value even if she won’t get paid until the trial is over.

b. What is the amount of the award you would recommend she receive today if the interest rate used to determine the award is 5.72%, compounded weekly (assume four weeks per month)?

DO NOT USE EXCEL

0 0
Add a comment Improve this question Transcribed image text
Answer #1

TO FIND:-

(a) What is the amount of the award you would recommend she receive if the interest rate used to determine the award is 9.0%, compounded monthly?

ANSWER:-

9% monthly

=(3000/(9%/12))*((1+9%/12)^12-1)*(1+9%/12)^12+3200/(9%/12)*((1+9%/12)^12-1)+3500/(9%/12)*(1-1/(1+9%/12)^60)=249673.74

******

(b) What is the amount of the award you would recommend she receive today if the interest rate used to determine the award is 5.72%, compounded weekly​​​​​​​

ANSWER:-

5.72% weekly

4 weeks per month

APR=((1+9%/12)^(12/48)-1)*48

8.975% compounded monthly

=(3000/(8.975%/12))*((1+8.975%/12)^12-1)*(1+8.975%/12)^12+3200/(8.975%/12)*((1+8.975%/12)^12-1)+3500/(8.975%/12)*(1-1/(1+8.975%/12)^60)

=249752.78

Add a comment
Know the answer?
Add Answer to:
You are the fore person of a jury charged with determining the amount of damages to...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
  • You are the fore person of a jury charged with determining the amount of damages to...

    You are the fore person of a jury charged with determining the amount of damages to pay to a plaintiff who was injured at work due to her employer’s negligence. Because of her injuries, she lost the previous two years’ salaries ($3,000 per month for the first year and $3,200 per month for the most recent year) and is expected to lose $3,500 per month for the next five years after today. a. What is the amount of the award...

  • You are serving on a jury. A plaintiff is suing the city for injuries sustained after...

    You are serving on a jury. A plaintiff is suing the city for injuries sustained after a freak street sweeper accident. In the trial, doctors testified that it will be five years before the plaintiff is able to return to work. The jury has already decided in favor of the plaintiff. You are the foreperson of the jury and propose that the jury give the plaintiff an award to cover the following: (a) The present value of two years’ back...

  • You are serving on a jury. A plaintiff is suing the city for injuries sustained after...

    You are serving on a jury. A plaintiff is suing the city for injuries sustained after a freak street sweeper accident. In the trial, doctors testified that it will be five years before the plaintiff is able to return to work. The jury has already decided in favor of the plaintiff. You are the foreperson of the jury and propose that the jury give the plaintiff an award to cover the following: (a) The present value of two years' back...

  • You are serving on a jury. A plaintiff is suing the city for injuries sustained after...

    You are serving on a jury. A plaintiff is suing the city for injuries sustained after a freak street sweeper accident. In the trial, doctors testified that it will be five years before the plaintiff is able to return to work. has already decided in favor of the plaintiff. You are the foreperson of the jury and propose that the jury give the plaintiff an award to cover the following: (a) The present value of two years' back pay. The...

  • You are serving on a jury. A plaintiff is suing the city for injuries sustained after...

    You are serving on a jury. A plaintiff is suing the city for injuries sustained after a freak street sweeper accident. In the trial, doctors testified that it will be five years before the plaintiff is able to return to work. The jury has already decided in favor of the plaintiff. You are the foreperson of the jury and propose that the jury give the plaintiff an award to cover the following: (1) The present value of two years’ back...

  • You are serving on a jury. A plaintiff is suing the city for injuries sustained after...

    You are serving on a jury. A plaintiff is suing the city for injuries sustained after a freak street sweeper accident. In the trial, doctors testified that it will be five years before the plaintiff is able to return to work. The jury has already decided in favor of the plaintiff. You are the foreperson of the jury and propose that the jury give the plaintiff an award to cover the following: (1) The present value of two years’ back...

  • You are serving on a jury. A plaintiff is suing the city for injuries sustained after...

    You are serving on a jury. A plaintiff is suing the city for injuries sustained after a freak street sweeper accident. In the trial, doctors testified that it will be five years before the plaintiff is able to return to work. The jury has already decided in favor of the plaintiff. You are the foreperson of the jury and propose that the jury give the plaintiff an award to cover the following: (1) The present value of two years’ back...

  • Problem 5-58 Calculating Annuity Values (LO 1] You are serving on a jury. A plaintiff is...

    Problem 5-58 Calculating Annuity Values (LO 1] You are serving on a jury. A plaintiff is suing the city for injuries sustained after a freak street-sweeper accident. In the trial, doctors testified that it will be five years before the plaintiff is able to return to work. The jury has already decided in favor of the plaintiff. You are the foreperson of the jury and propose that the jury give the plaintiff an award to cover the following: (a) The...

  • You are serving on a jury. A plaintiff is suing the city for injuries sustained after...

    You are serving on a jury. A plaintiff is suing the city for injuries sustained after a freak street sweeper accident. In the trial, doctors testified that it will be five years before the plaintiff is able to return to work. The jury has already decided in favor of the plaintiff. You are the foreperson of the jury and propose that the jury give the plaintiff an award to cover the following: (a) The present value of two years’ back...

  • You are serving on a jury. A plaintiff is suing the city for injuries sustained after...

    You are serving on a jury. A plaintiff is suing the city for injuries sustained after a freak street sweeper accident. In the trial, doctors testified that it will be five years before the plaintiff is able to return to work. The jury has already decided in favor of the plaintiff. You are the foreperson of the jury and propose that the jury give the plaintiff an award to cover the following: (a) The present value of two years’ back...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT