The roc will receive 500 million rubles per month over the


Inflation in Russistan currently averages 40% per month. It is expected to diminish to 20% per month following the presidential elections 12 months from now. The Russistan Oil Company (ROC) has just signed an agreement with the Global Petroleum Group for the sale of future shipments.

The ROC will receive 500 million rubles per month over the next two years, and also 500 million rubles per month indexed to inflation (i.e., real rubles). If the ROC has a real ALARR of 1.5% per month, what is the total present worth of this contract?

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Management Theories: The roc will receive 500 million rubles per month over the
Reference No:- TGS02171392

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