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lisov135 [29]
3 years ago
14

A recent Mega Millions estimated jackpot amount is $300 million which is the undiscounted sum of the 26 annuity option payments

with a Cash Option of $207 million. The first payment under the Annuity Option which would occur immediately is $4,515,432 with 29 additional annual payments with each payment being 5% larger than the previous one. Using this information and assuming you demand a 4% annual return, would you prefer the Annuity Option or the Cash Option if you have the winning ticket?
Business
1 answer:
I am Lyosha [343]3 years ago
4 0

Answer:

Itis better to take the case in hand of 207,000,000 millions

Explanation:

We need to calcualte the present value of a geometric annuity-due

\frac{1-(1+g)^{n}\times (1+r)^{-n} }{r - g}

g 0.05

r 0.04

C 4,515,432

n 26

n 26

\frac{1-(1+0.05)^{26}\times (1+0.04)^{-26} }{0.04-0.05}

 127,557,727.45

As is an annuity due, we multiply by (1+r)

127,557,727.45 x (1+0.04) = 132,660,036,548

The present value of the 207,000,000 option is better as the annuity present value is around 130,000,000

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videoconferencing

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6 0
1 year ago
Suppose that a price-discriminating firm divides its market into two segments. If the firm sells its product for a price of $22
Mashcka [7]

Answer:

The correct answer is: less than $22.

Explanation:

Price discrimination is a situation where a firm charges different prices for the same product. Different price is charged generally from consumers with different price elasticities.  

A firm charges a higher prices from the consumer with lower price elasticity because with a higher price there demand will decrease less than proportionate.

Lower price is charged from consumers having a higher price elasticity of demand because these consumers will decrease their demand more than proportionate at a higher price.  

So if a firm charges $22 in the market segment with less elastic demand, the price in the more elastic market segment will be lower than $22.

5 0
3 years ago
While working on a coloring worksheet, 5-year-old Aaliyah can be heard whispering, "Color this one blue. Stay in the lines. Oh,
dimulka [17.4K]

Answer:called private speech

Explanation:A Private speech is speech spoken to oneself for communication, self-guidance, and self-regulation of behavior. Children from two to about seven years old can be observed engaging in private speech. Although it is audible, it is neither intended for nor directed at others.

Private speech is self-talk children (and adults) may use to guide actions and aid in thinking. While Piaget may view private speech as egocentric or immature, Vygotsky understood the importance of self-directed speech.

7 0
3 years ago
A $100 petty cash fund has cash of $17 and receipts of $86. The journal entry to replenish the account would include a :
Paladinen [302]

Answer:

The correct option is C, credit to cash over and short for $3

Explanation:

The requirement targets the balancing entry in the cash account,with cash of $17 in the petty cash account coupled with receipts of $86, the total amount in the petty cash is $103 ($86+$17) and the established float is just $100, which implies that the petty cash has an excess fund of $3 that must be returned to the main cash account.

The excess is the difference between $103 cash in the petty cash account and the maximum float of $100($103-$100)

4 0
4 years ago
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"Uber’s first challenge is managing for competitive advantage. What function of management is most closely related to setting go
mihalych1998 [28]

Answer: Planning function of management

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In the given case, uber wants to manage their competitive advantage. Therefore the management should plan their policies in such away that company can maintain their traits that are giving them advantage in market over others.

6 0
3 years ago
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