You have won the lottery! That is just great. But, what have you really won? It is a $20,000,000 lottery, with twenty payments (the first one is provided today) of $1,000,000 each. If the best discount rate for these future cash flows is 7.5%, compounding annually, what is the actual value, including today's payment, of your "$20 million lottery?" (to the nearest $1,000,000) O $8,000,000 O $9,000,000 O $10,000,000 O $11.000 000

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
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You have won the lottery! That is just great. But, what have you really won? It is a $20,000,000 lottery,
with twenty payments (the first one is provided today) of $1,000,000 each. If the best discount rate for
these future cash flows is 7.5%, compounding annually, what is the actual value, including today's
payment, of your "$20 million lottery?" (to the nearest $1,000,000)
O $8,000,000
O $9,000,000
O $10,000,000
O $11,000,000
Transcribed Image Text:You have won the lottery! That is just great. But, what have you really won? It is a $20,000,000 lottery, with twenty payments (the first one is provided today) of $1,000,000 each. If the best discount rate for these future cash flows is 7.5%, compounding annually, what is the actual value, including today's payment, of your "$20 million lottery?" (to the nearest $1,000,000) O $8,000,000 O $9,000,000 O $10,000,000 O $11,000,000
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