Question

# Brief Exercise A-9 Messi Company is considering an investment that will return a lump sum of...

Brief Exercise A-9

Messi Company is considering an investment that will return a lump sum of \$940,000 6 years from now.

(For calculation purposes, use 5 decimal places as displayed in the factor table provided.)

What amount should Messi Company pay for this investment to earn an 6% return? (Round answer to 2 decimal places, e.g. 25.25.)

 Messi Company should pay \$

Period = 6 years
Required Return = 6%

Amount Invested = \$940,000 * PV of \$1 (6%, 6)
Amount Invested = \$940,000 * 0.70496
Amount Invested = \$662,662.40

Messi Company should pay \$662,662.40

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