Joan Lucky won the $6 million lottery She is to recerve $2 3 million a year for the next 25 years plus an additional lump-sum payment of $8.5 million after 25 years. The discount rate is 11 percent What is the current value of her winnings? Use Appendex B and Appendx D. (Provide answers in terms of millions of dollars. Round "PV Foctor" to 3 decimal pleces. Round the final answer to the nearest whole dollar.) Current Value $ 19.995

Joan Lucky won the $6 million lottery She is to recerve $2 3 million a year for the next 25 years plus an additional lump-sum payment of $8.5 million after 25 years. The discount rate is 11 percent What is the current value of her winnings? Use Appendex B and Appendx D. (Provide answers in terms of millions of dollars. Round "PV Foctor" to 3 decimal pleces. Round the final answer to the nearest whole dollar.) Current Value $ 19.995

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Peggy just won the lottery! She could either receive $75,000 today or $1,000,000 in 40 years. At what rate of interest, compounded annually, would Peggy be indifferent between accepting the lottery winnings of $75,000 today and investing it on her own? A) 6.7%B) 6.1%C) 5.5%D) 2.4%
How much must be deposited today into the following account in order to have a $135,000 college fund in 11 years? Assume no additional deposits are made. An account with quarterly compounding and an APR of 7.32% $ should be deposited today. (Do not round until the final answer. Then round to the nearest cent as needed.) Enter your answer in the answer box. Type here to search 0 哥同

Luis won the lottery; however, the lottery company gave him the following two options to receive his prize money: Option (a): $8,000 in two months and $18,000 in eleven months. Option (b): $4,000 immediately and $24,000 in fourteen months. Assume that money earns 4.5% p.a. simple interest and use today as the focal date. a. What was the equivalent value of the payments under option (a) at the focal date? $0.00 Round to the nearest cent b. What was the equivalent value of the payments under option (b) at the focal date? $0.00 Round to the nearest cent c. Which option would be economically better for Luis and by how much? O a. Option (a) o b. Option (b) is better by $0.00 Round to the nearest cent
Megan Brink is offered the possibility of investing $8,205 today at 9% Interest per year in a desire to accumulate $15,000. How many years must Brink wait to accumulate $15,000? (PV of $1. EV of $1. PVA of $1. and EVA of $1) (Use appropriate factor(s) from the tables provided. Round your "PV of a single amount" to 4 decimal places and final answer to the nearest whole number.) Present Value 150,000 Answer is complete but not entirely correct. P (PV of a Single Amount) Future Value 0.6421 Years 2 years
Thomas won a lottery that will pay $550000 at the end of each of the next twenty years. Sandhill Finance has offered to purchase the payment stream for $6853000. What interest rate (to the nearest percent) was used to determine the amount of the payment? O 5% O 7% O 6% 8% e Textbook and Media
Alex Meir recently won a lottery and has the option of receiving one of the following three prizes: (1) $94,000 cash immediately, (2) $38,000 cash immediately and a six-period annuity of $9,700 beginning one year from today, or (3) a six-period annuity of $19,600 beginning one year from today. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) 1. Assuming an interest rate of 7%, determine the present value for the above options. Which option should Alex choose?2. The Weimer Corporation wants to accumulate a sum of money to repay certain debts due on December 31, 2030. Weimer will make annual deposits of $190,000 into a special bank account at the end of each of 10 years beginning December 31, 2021. Assuming that the bank account pays 8% interest compounded annually, what will be the fund balance after the last payment is made on December 31, 2030?
I recently found a real-life advertisement in the newspaper. (Only the phone number has been changed.) Suppose that you have won a $20,000,000 lottery, paid in 20 annual installments. How much would be a fair price to be paid today for the assignment of this prize? Assume the money could be invested at 12%. (Assume the lottery pays out as an ordinary annuity. Round your answer to the nearest cent.) $ la-7:30p ffordable. 555-8310. Massage 55 in/o CARE 555-372 DUCH 8-3590 * 21 Massage In Call 253 E LOAN WANTED: $150,000, se- sold unless cured by approx. $600,000 clearly indic equity In four sepsele proper- and telemai pay 1476 and five ptain the be en earni or implied. ma es eve advertiseme or do no or quirement Have exc. credit. 555-4285. *** WE PAY CASH *** for R.E notes, lotteries, annuities, bus. notes, Inheritances. Please call 800-555-7853. 2 ENTREPRENEURS need invesnot be resp to establish a juice error, we as Min. S Interest. 555-4668. 15% be reportec may take e $6000 NEEDED for…
Congratulations! You have just won a small lottery. Lottery officials give you three alternatives for receiving your winnings: a)$8000 now b)$1000 per year for 12 years c)$15000 in 10 years If you can earn 6.5% on your money, which alternative should you choose?
You have just received notification that you have won the $2.05 million first prize in the Centennial Lottery. However, the prize will be awarded on your 100th birthday (assuming you're around to collect), 75 years from now. What is the present value of your windfall if the appropriate discount rate is 10 percent? Note: Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, rounded to 2 decimal places, e.g., 1,234,567.89. Present value

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