8) Lottery prizes are often not "worth" as much as claimed. What is the present value...
Homework Answers
Solution:
Equal yearly installment = $5,000,000 / 20 = $250,000
PResent value of prize = $250,000 * Cumulative PV factor at 7% for 20 periods of annuity due
= $250,000 * 11.33560
= $2,833,900
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8) Lottery prizes are often not "worth" as much as claimed.
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