An alumnus of M.I.T who made good has decided to donate to the
colleges Excellence Fund and has offered the college any one of the
following three plans:

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Question: An alumnus of M.I.T who made good has decided to donate to the colleges Excellence Fund and has o…
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Plan A: Plan B: Plan C:

$60,000 now
$16,000 per year for 12 years beginning 1 year from now
$50,000 three years from now and another $80,000 five years from
now

The only condition placed on the donation is that the college
agrees to append the money on research related to the advancement
of robotics. The college would like to select the plan which
maximizes the buying power of the dollars received, so it has
instructed one industrial engineer student evaluating the plans to
account for inflation in their calculations. If the college can
earn 12% per year on its ready-assets account and the inflation
rate is expected to be 11% per year, which plan should the college
accept?

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