You win a 1.8 million dollar lottery prize. You have a choice between recieving the winnings through regular payments over 20 years or recieving a lump sum amount equal to the present value of the prize, calculated with an annual interest rate of 4.4 %. Consider the decision by answering the questions below. Round all answers to the two decimal places (the nearest cent). (a) If you receive the winnings through equal payments (at the end of the year) for 20 years, how much would each payment be? Payment amount: $ (b) If you opt to recieve the present value of the winnings, how much would you receive?
You win a 1.8 million dollar lottery prize. You have a choice between recieving the winnings through regular payments over 20 years or recieving a lump sum amount equal to the present value of the prize, calculated with an annual interest rate of 4.4 %. Consider the decision by answering the questions below. Round all answers to the two decimal places (the nearest cent). (a) If you receive the winnings through equal payments (at the end of the year) for 20 years, how much would each payment be? Payment amount: $ (b) If you opt to recieve the present value of the winnings, how much would you receive?
Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter9: Current Liabilities, Contingencies, And The Time Value Of Money
Section: Chapter Questions
Problem 9.20MCE
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You win a 1.8 million dollar lottery prize. You have a choice between recieving the winnings through regular payments over 20 years or recieving a lump sum amount equal to the
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