You have won a lottery that pays you $100,000.00 at the end of this year, $110,000.00 at the end of the second, $120,000.00 the end of the third and so on for thirty years. A friend has offered you $1,200,000.00 today in exchange for all the income you will receive from the lottery win over the next 30 years. If you can get 8% interest on your savings is this a good deal?
You have won a lottery that pays you $100,000.00 at the end of this year, $110,000.00 at the end of the second, $120,000.00 the end of the third and so on for thirty years. A friend has offered you $1,200,000.00 today in exchange for all the income you will receive from the lottery win over the next 30 years. If you can get 8% interest on your savings is this a good deal?
Economics Today and Tomorrow, Student Edition
1st Edition
ISBN:9780078747663
Author:McGraw-Hill
Publisher:McGraw-Hill
Chapter6: Saving And Investing
Section6.1: Why Save?
Problem 6R
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You have won a lottery that pays you $100,000.00 at the end of this year, $110,000.00 at the end of the second, $120,000.00 the end of the third and so on for thirty years. A friend has offered you $1,200,000.00 today in exchange for all the income you will receive from the lottery win over the next 30 years. If you can get 8% interest on your savings is this a good deal?
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