Time value of money You are hurt in a car accident and your lawyer wins a $100,000 settlement to be distributed as follows:

Time value of money

You are hurt in a car accident and your lawyer wins a $100,000 settlement to

be distributed as follows:

$20,000 immediate payment

$5,000 a year for ten years starting now

$30,000 after ten years.

If the lawyer’s fee is $10,000, what is the value of this settlement if the interest

rate is 10 percent?