Question

1. Sherwin Williams will earn $18,500 a year for the next 19 years for a picture he has painted. At an interest rate of 12 percent, how much are the earnings worth today? (Enter your answer as a positive number rounded to 2 decimal places.)

2.You just won the $44 million lottery. You will receive $1.3 million a year for the next 25 years plus an additional payment of $11.5 million at the end of 25 years. The interest rate is 18 percent.
How much is your lottery prize worth today? (Enter your answer as a positive number rounded to 2 decimal places.)

3.If you owe $36,000 payable at the end of four years, what amount should your creditor accept in payment immediately if the interest rate on the loan is 9 percent? (Enter your answer as a positive number rounded to 2 decimal places.)

4.You have decided to start saving money for your future. What is the future value of a 12-year annuity of $2,300 per year, assuming that you make your first payment today and the interest rate is 10 percent? (Enter your answer as a positive number rounded to 2 decimal places.)

Answer 1

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