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As a winner of a lottery you are going to receive $10,000 every year...
4. The state lottery claims that its grand prize is $1 million. The lucky winner will...
4. The state lottery claims that its grand prize is $1 million. The lucky winner will receive $100,000 upon presentation of the winning ticket plus $100,000 at the end of each year for the next 9 years. Assume a 8% discount rate. a-Why isn't this really a million-dollar prize? b. What would it actually be worth in dollars to you? c. What would the 10 yearly payments need to be for the present value of the lottery to be $1...
Susan Wilson has won a state lottery and will receive a payment of $89,000 every year,...
Susan Wilson has won a state lottery and will receive a payment of $89,000 every year, starting today, for the next 20 years. If she invests the proceeds at a rate of 5.51 percent, what is the present value of the cash flows that she will receive
4. The state lottery claims that its grand prize is $1 million. The lucky winner will...
4. The state lottery claims that its grand prize is $1 million. The lucky winner will receive $100,000 upon presentation of the winning ticket plus $100,000 at the end of each year for the next 9 years. Assume a 10% discount rate. a-Why isn't this really a million-dollar prize? (5 Points) b-What would it actually be worth in dollars to you? (5 Points) C-What would the 10 yearly payments need to be for the present value of the lottery to...
You have won the lottery. You will receive $2,550,000 today, and then receive 40 payments of...
You have won the lottery. You will receive $2,550,000 today, and then receive 40 payments of $1,275,000 These payments will start one year from now and will be paid every six months. A representative from Greenleaf Investments has offered to purchase all the payments from you for $20 million. The appropriate discount rate is an APR of 10 percent compounded daily. Assume there are 12 months in a year, each with 30 days. What is the present value of the...
WHY IS THIS THE ANSWER? (1) You’ve just won the state lottery and will receive 20...
WHY IS THIS THE ANSWER?
(1) You’ve just won the state lottery and will receive 20 annual
payments of $70,000, with the first payment arriving 1 year from
today. It is easy for you to borrow or lend on the capital market
at an interest rate of 8% per year. If someone offered to buy your
stream of winnings for a one-time payment of $1,000,000, would you
sell?
Answer: Yes, you could discount each payment to find the
present value...
Sandra Robinson has won a state lottery and will receive a payment of $88,000 every year,...
Sandra Robinson has won a state lottery and will receive a payment of $88,000 every year, starting today, for the next 20 years. If she invests the proceeds at a rate of 5.11 percent, what is the present value of the cash flows that she will receive? (Round factor values to 4 decimal places, e.g. 1.5212 and final answer to nearest whole dollar, e.g. 5275.) Present value of investment $
Margaret Moore has won a state lottery and will receive a payment of $94,000 every year,...
Margaret Moore has won a state lottery and will receive a payment of $94,000 every year, starting today, for the next 20 years. If she invests the proceeds at a rate of 5.78 percent, what is the present value of the cash flows that she will receive? (Round factor values to 4 decimal places, e.g. 1.5212 and final answer to nearest whole dollar, e.g. 5275.) Present value of investment $
You have won the lottery. You will receive $2,590,000 today, and then receive 40 payments of...
You have won the lottery. You will receive $2,590,000 today, and then receive 40 payments of $1,295,000 These payments will start one year from now and will be paid every six months. A representative from Greenleaf Investments has offered to purchase all the payments from you for $25 million. The appropriate discount rate is an APR of 9 percent compounded daily. Assume there are 12 months in a year, each with 30 days. What is the present value of...
You have just won the lottery. You and your heirs will receive $25,000 per year forever...
You have just won the lottery. You and your heirs will receive $25,000 per year forever beginning three years from now. What is the present value of this lottery given an 8% discount rate? O $245,436 ( $253,776 $267,918 $276,765 $288,911
You have just won the lottery. You will receive $2,580,000 today, and then receive 40 payments...
You have just won the lottery. You will receive $2,580,000 today, and then receive 40 payments of $1,290,000 These payments will start one year from now and will be paid every six months. A representative from Greenleaf Investments has offered to purchase all the payments from you for $20 million. The interest rate is an APR of 10 percent compounded daily. Assume there are 12 months in a year, each with 30 days. What is the present value of the...
4. The state lottery claims that its grand prize is $1 million. The lucky winner will receive $100,000 upon presentation of the winning ticket plus $100,000 at the end of each year for the next 9 years. Assume a 10% discount rate. a-Why isn't this really a million-dollar prize? (5 Points) b-What would it actually be worth in dollars to you? (5 Points) C-What would the 10 yearly payments need to be for the present value of the lottery to...
Sandra Robinson has won a state lottery and will receive a payment of $88,000 every year, starting today, for the next 20 years. If she invests the proceeds at a rate of 5.11 percent, what is the present value of the cash flows that she will receive? (Round factor values to 4 decimal places, e.g. 1.5212 and final answer to nearest whole dollar, e.g. 5275.) Present value of investment $
Margaret Moore has won a state lottery and will receive a payment of $94,000 every year, starting today, for the next 20 years. If she invests the proceeds at a rate of 5.78 percent, what is the present value of the cash flows that she will receive? (Round factor values to 4 decimal places, e.g. 1.5212 and final answer to nearest whole dollar, e.g. 5275.) Present value of investment $
You have just won the lottery. You and your heirs will receive $25,000 per year forever beginning three years from now. What is the present value of this lottery given an 8% discount rate? O $245,436 ( $253,776 $267,918 $276,765 $288,911
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