Use the advertisement shown in Figure 11.12 as a basis for answering Problems 14-20. Assume the current
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Use the advertisement shown in Figure 11.12 as a basis for answering Problems 14-20. Assume the current interest rate is \(1.7 \%\).
Figure 11.12
What is the present value of the annuity?
Transcribed Image Text:
TRA $1,000,000 Win a $1,000,000 annuity paid as 29 annual installments of $20,000 each plus a one-time payment of $420,000 in the 30th year, or a lump sum payment of $700,000 cash. You'll also get lifetime subscriptions to Time, Money and Fortune to help you manage your new found wealth.
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The present value of an annuity can be calculated using the following formula PV PMT times left frac...View the full answer
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