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Suppose you have just won a lottery. You will receive a total of 27 annual payment,...

Suppose you have just won a lottery. You will receive a total of 27 annual payment, and each payment is $3,371. You will receive the first payment today. If you can earn 6% annual rate of return each year, how much is this lottery worth to you today? (round to the nearest dollar. )

PLEASE INCLUDE EXCEL FORMULA

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Answer #1

- Annual periodic payment starting from today is $3371 for 27 years

Calculating the Present Value of periodic annual payments using excel "PV" function:-

So, lottery worth to you today is $47,205

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