I need help with #16 please 1:49$12,462,210C) $13,085,321D) $20,000,0000016) All else equal, at what interest rate wouldthe PDV of a lottery prize that pays$1,000,000 today and $1,000,000 eachfor the next 19 years be equal toyear$10,000,000?A) 5.26%B) 7.75%C) 8.92%D) 50.00%17) A consumption bundle is affordable aslong asA) it is a point that is on an| 36% الB)indifference curve that is to theright of the budget line.it is a point that falls on the 45degree line.C) the present discount value of theconsumption stream is less than thepresent discount value of theincome stream.D) the amount of the good consumedfrom year to year does notincrease.GoodsNext Year18) Refer to Figure 10.1. Suppose theindividual is initially at point b. Based onthe figure, the individual could afford toincrease his utility by

16) Present Discounted Value (PDV) is a concept in finance that calculates the current worth of a…

16) All else equal, at what interest rate would the PDV of a lottery prize that pays $1,000,000 today and $1,000,000 each year for the next 19 years be equal to $10,000,000? A) 5.26% B) 7.75% C) 8.92% D) 50.00%

16) All else equal, at what interest rate would the PDV of a lottery prize that pays $1,000,000 today and $1,000,000 each year for the next 19 years be equal to $10,000,000? A) 5.26% B) 7.75% C) 8.92% D) 50.00%

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

I need help with #16 please

1:49
$12,462,210
C) $13,085,321
D) $20,000,000
00
16) All else equal, at what interest rate would
the PDV of a lottery prize that pays
$1,000,000 today and $1,000,000 each
for the next 19 years be equal to
year
$10,000,000?
A) 5.26%
B) 7.75%
C) 8.92%
D) 50.00%
17) A consumption bundle is affordable as
long as
A) it is a point that is on an
| 36% ال
B)
indifference curve that is to the
right of the budget line.
it is a point that falls on the 45
degree line.
C) the present discount value of the
consumption stream is less than the
present discount value of the
income stream.
D) the amount of the good consumed
from year to year does not
increase.
Goods
Next Year
18) Refer to Figure 10.1. Suppose the
individual is initially at point b. Based on
the figure, the individual could afford to
increase his utility by

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