1. Imprudential, Inc., has an unfunded pension liability of $583 million that must be paid in 15 years. To assess the value of the firm’s stock, financial analysts want to discount this liability back to the present.
If the relevant discount rate is 7.6 percent, what is the present value of this liability? (Enter your answer in dollars not in millions, e.g., 1,234,567. Do not round intermediate calculations and round your final answer to 2 decimal places, e.g., 32.16.)
2. What are the major economic classifications of nations? Give one or two characteristics of each classification.
Why are these classifications important ? In other words, how are they used?