A lottery claims its grand prize is $10 million, payable over 20 years at $500,000 per year. If the first payment is made immedi

Question

Dennis_Churaev [7]

4 years ago

6

A lottery claims its grand prize is $10 million, payable over 20 years at $500,000 per year. If the first payment is made immedi

ately, what is this grand prize really worth? Use an interest rate of 6%.

Social Studies

1 answer:

dybincka [34] · Answer 1 · 2021-11-24T19:18:01+03:00

dybincka [34]4 years ago

3 0

Answer:

$6,079,058.25

Explanation:

This is a simple present value problem. Using a financial calculator:N  20; PMT  500,000; FV  0; I  6%; Pmts in BEGIN mode.Compute PV : PV  $6,079,058.25