In most states, the winnings of million-dollar lottery jackpots are divided into equal payments given annually for 20 years. (In Colorado, the results are distributed over 25 years.) This means that the present value of the jackpot is worth less than the stated prize, with the actual value determined by the interest rate at which the money could be invested. Source: The New York Times Magazine.(a) Find the present value of a $1 million lottery jackpot dis- tributed in equal annual payments over 20 years, using an interest rate of 5%.(b) Find the present value of a $1 million lottery jackpot dis- tributed in equal annual payments over 20 years, using an interest rate of 9%.(c) Calculate the answer for part (a) using the 25-year distri- bution time in Colorado.(d) Calculate the answer for part (b) using the 25-year distribution time in Colorado.
Unitary Method
The word “unitary” comes from the word “unit”, which means a single and complete entity. In this method, we find the value of a unit product from the given number of products, and then we solve for the other number of products.
Speed, Time, and Distance
Imagine you and 3 of your friends are planning to go to the playground at 6 in the evening. Your house is one mile away from the playground and one of your friends named Jim must start at 5 pm to reach the playground by walk. The other two friends are 3 miles away.
Profit and Loss
The amount earned or lost on the sale of one or more items is referred to as the profit or loss on that item.
Units and Measurements
Measurements and comparisons are the foundation of science and engineering. We, therefore, need rules that tell us how things are measured and compared. For these measurements and comparisons, we perform certain experiments, and we will need the experiments to set up the devices.
In most states, the winnings of million-dollar lottery jackpots are divided into equal payments given annually for 20 years. (In Colorado, the results are distributed over 25 years.) This means that the present value of the jackpot is worth less than the stated prize, with the actual value determined by the interest rate at which the money could be invested. Source: The New York Times Magazine.
(a) Find the present value of a $1 million lottery jackpot dis- tributed in equal annual payments over 20 years, using an interest rate of 5%.
(b) Find the present value of a $1 million lottery jackpot dis- tributed in equal annual payments over 20 years, using an interest rate of 9%.
(c) Calculate the answer for part (a) using the 25-year distri- bution time in Colorado.
(d) Calculate the answer for part (b) using the 25-year distribution time in Colorado.
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