You have just won the lottery and must decide between $3,000,000 paid in 20 annual payments of$150,000 with the first payment coming one year from today or a lump sum payment today. If fairmarket interest rates are 7% what lump sum payment today is equivalent to the annual $150,000payments?Round your answer to the nearest dollar.

You have just won the lottery and must decide between $3,000,000 paid in 20 annual payments o $150,000 with the first payment coming one year from today or a lump sum payment today. If fai market interest rates are 7% what lump sum payment today is equivalent to the annual $150,000 payments?

You have just won the lottery and must decide between $3,000,000 paid in 20 annual payments o $150,000 with the first payment coming one year from today or a lump sum payment today. If fai market interest rates are 7% what lump sum payment today is equivalent to the annual $150,000 payments?

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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You have just won the lottery and must decide between $3,000,000 paid in 20 annual payments of
$150,000 with the first payment coming one year from today or a lump sum payment today. If fair
market interest rates are 7% what lump sum payment today is equivalent to the annual $150,000
payments?
Round your answer to the nearest dollar.

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