Question

You have just won the Georgia Lottery with a jackpot of $53,000,000. Your winnings will be...

You have just won the Georgia Lottery with a jackpot of $53,000,000. Your winnings will be paid to you in 26 equal annual installments with the first payment made immediately. If you feel the appropriate annual discount rate is 14%, what is the present value of the stream of payments you will receive?

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
You have just won the Georgia Lottery with a jackpot of $26,000,000. Your winnings will be...
You have just won the Georgia Lottery with a jackpot of $26,000,000. Your winnings will be paid to you in 26 equal annual installments with the first payment made immediately. If you had the money now, you could invest it in an account with a quoted annual interest rate of 8% with monthly compounding of interest. What is the present value of the stream of payments you will receive?
You have just won the Mega Millions Lottery with a jackpot of $54,000,000. Your winnings will...
You have just won the Mega Millions Lottery with a jackpot of $54,000,000. Your winnings will be paid to you in 26 equal annual installments with the first payment made immediately. If you had the money now, you could invest it in an account with a quoted annual interest rate of 12% with monthly compounding of interest. What is the present value of the stream of payments you will receive?
What if you have just won the Strayer Lottery jackpot of $11,000,000. You will be paid...
What if you have just won the Strayer Lottery jackpot of $11,000,000. You will be paid in 26 equal annual installments beginning immediately. If you had the money now, you could invest it in an account with a quoted annual interest rate of 9% with monthly compounding of interest. What is the present value of the payments you will receive? In your own words and using various bond websites, locate one of each of the following bond ratings: AAA, BBB,...
You have just been notified that you have won the jackpot in a lottery. You can...
You have just been notified that you have won the jackpot in a lottery. You can accept your winnings in one of the following cashflow streams. Assume you are not liable for any income taxes on the winnings. Compare the alternatives assuming a long-term average interest rate on any investments of 8%. (1) RM 900,000 per year for ten years, first payment received immediately. (2) RM 750,000 per year for twenty years, first payment received immediately. (3) RM 75,000 per...
You have just won $10 million in the lottery! However, the actual payment will be made...
You have just won $10 million in the lottery! However, the actual payment will be made in 20 equal annual installments, the first one to be recieved immediately. In present value terms, how much have you really won, assuming that you can earn 8 percent per year on your money? (Show Calculations)
You have just won a jackpot of $15,000,000 in the lottery and must choose between a...
You have just won a jackpot of $15,000,000 in the lottery and must choose between a lump sum payment today of $10,000,000 or equal installments of $750,000 per year with the first installment coming today and the remainder coming at the end of each of the next 19 years. If you can invest the proceeds and earn 5 percent, which option should you choose? At what interest rate would you be indifferent between the cash and annual payment options. You...
You have just won the lottery and will receive $600,000 in one year. You will receive...
You have just won the lottery and will receive $600,000 in one year. You will receive payments for 16 years, and the payments will increase 5 percent per year. If the appropriate discount rate is 12 percent, what is the present value of your winnings?
You have just won the lottery and will receive $650,000 in one year. You will receive...
You have just won the lottery and will receive $650,000 in one year. You will receive payments for 15 years, and the payments will increase 4 percent per year. If the appropriate discount rate is 11 percent, what is the present value of your winnings?
You have just won the lottery! You decide to take your winnings as a series of...
You have just won the lottery! You decide to take your winnings as a series of $1,000,000 payments for the next 20 years with the first payment being paid today. What method should we use to value the series of payments? Select one: a. Ordinary Annuity b. Ordinary Perpetuity c. Compounding Annuity d. Annuity Due e. None of these describes how the series of payments should be valued.
You have just won the lottery and will receive $620,000 in one year. You will receive...
You have just won the lottery and will receive $620,000 in one year. You will receive payments for 15 years, which will increase 3 percent per year. The appropriate discount rate is 12 percent. Required: What is the present value of your winnings?
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT