Posted by **Kim** on Sunday, March 11, 2007 at 3:47pm.

A train company has signed a contract to deliver a new fuel driven train 3 years from now. The price they will receive at the end of 3 years is $20 million. If the firm's cost of capital is 6%, what is the present value of this payment?

A train company has signed a contract to deliver a new fuel driven train 3 years from now. The price they will receive at the end of 3 years is $20 million. If the firm's cost of capital is 6%, what is the present value of this payment?