Michael has just won the lottery! He has an option of taking a lump sum of...
Michael has just won the lottery! He has an option of taking a lump sum of $17 million or can be paid $900,000 per year for 30 years at the end of the year. The discount rate is 3%. Which option is better?
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Michael has just won the lottery! He has an option of taking a
lump sum of...
Your friend just won the lottery. He has a choice of receiving $122,788 a year for...
Your friend just won the lottery. He has a choice of receiving $122,788 a year for the next 18 years or a lump sum today. The lottery uses a 8% discount rate. What would be the lump sum your friend would receive?
You have just won the $1,000,000 in the lottery. You have the option of taking a lump sum payout or equal annualized pay...
You have just won the $1,000,000 in the lottery. You have the option of taking a lump sum payout or equal annualized payments over 20 years. Ignoring any tax consequences; how much should you expect from the annualized payments. What target interest rate would make the annualized payments more valuable than the lump sum. In your response, you may want to consider such issues as inflation, investing lump sum in stock market (What have been the long-term historic returns?) to...
You have just won the $1,000,000 in the lottery. You have the option of taking a lump sum payout or equal annualized pay...
You have just won the $1,000,000 in the lottery. You have the option of taking a lump sum payout or equal annualized payments over 20 years. Ignoring any tax consequences; how much should you expect from the annualized payments. What target interest rate would make the annualized payments more valuable than the lump sum. In your response, you may want to consider such issues as inflation, investing lump sum in stock market (What have been the long-term historic returns?) to...
Your friend just won the lottery. He has a choice of receiving $50,000 a year for...
Your friend just won the lottery. He has a choice of receiving $50,000 a year for the next 20 years or a lump sum today. The lottery uses a 15% discount rate. What would be the lump sum your friend would receive? I know the answer is 312,966.57, however, I don't know why my calculator cannot get this number.
Juan just won $2.5 million in the state lottery. He is given the option of receiving...
Juan just won $2.5 million in the state lottery. He is given the option of receiving a total of $1.3 million now, or he can elect to be paid $100,000 at the end of each of the next 25 years. If Juan can earn 5% annually on his investments, from a strict economic point of view, which option should he take? Explain why.
Juan just won $2.5 million in the state lottery. He is given the option of receiving...
Juan just won $2.5 million in the state lottery. He is given the option of receiving a total of $1.3 million now, or he can elect to be paid $100,000 at the end of each of the next 25 years. If Juan can earn 5% annually on his investments, from a strict economic point of view, which option should he take? Explain why.
2. Kelsey just won the lottery, and she must choose among three award options .She can...
2. Kelsey just won the lottery, and she must choose among three award options .She can elect to receive a lump sum today of $62 million, to receive end-of-month payments of $0.8 million for 10 years or to receive end-of month payments of $0.47 million for 30 years. If she can earn 8% annually (i.e., the discount rate is 8% per year), which is the best choice based on the PV of the three award options? a) PV of 1st...
14.( )Joe Brady just won a $450,000 lottery in Pennsylvania. Instead of receiving a lump sum,...
14.( )Joe Brady just won a $450,000 lottery in Pennsylvania. Instead of receiving a lump sum, he found that he would receive $22,500 annually (end of year) for 20 years. Joe is 75 years old and wants his money now. He has been offered $140, 827 to sell his ticket. What rate of return is the buyer expecting to make if Joe accepts the offer? a. b. C. d. less than 1% 15% 18% 12%
Bill won the $53 million lottery. He is to receive $2 million a year for the...
Bill won the $53 million lottery. He is to receive $2 million a year for the next 20 years plus an additional lump sum payment of $13 million at the end of the 20 years. Assuming a discount rate of 10%, what is the present value of his
2. Gabrielle just won $1.8 million in the state lottery. She is given the option of...
2. Gabrielle just won $1.8 million in the state lottery. She is given the option of receiving a total of S900,000 now, or she can elect to be paid $90,000 at the end of each of the next 20 years. If Gabrielle can earn 6% annually on her investments, from a strict economic point of view which option should she take? If Gabrielle takes the prize as an annuity, the present value of the 20-year ordinary annuity is S Round...
Your friend just won the lottery. He has a choice of receiving $122,788 a year for the next 18 years or a lump sum today. The lottery uses a 8% discount rate. What would be the lump sum your friend would receive?
14.( )Joe Brady just won a $450,000 lottery in Pennsylvania. Instead of receiving a lump sum, he found that he would receive $22,500 annually (end of year) for 20 years. Joe is 75 years old and wants his money now. He has been offered $140, 827 to sell his ticket. What rate of return is the buyer expecting to make if Joe accepts the offer? a. b. C. d. less than 1% 15% 18% 12%
2. Gabrielle just won $1.8 million in the state lottery. She is given the option of receiving a total of S900,000 now, or she can elect to be paid $90,000 at the end of each of the next 20 years. If Gabrielle can earn 6% annually on her investments, from a strict economic point of view which option should she take? If Gabrielle takes the prize as an annuity, the present value of the 20-year ordinary annuity is S Round...
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