A lottery ticket states that you will receive $250 every year for the next ten years a What is the value of the winning lottery ticket in present value if the discount rate is 6 , and it is an ordinary annuity b What is the value of the winning lottery ticket in present value if the discount rate i...

Answer with calculator settings are PY 1 CY 1 and END mode Part a INPUT 10 60 250 0 Variables N ...

A lottery ticket states that you will receive $250 every year for the next ten years. a.

Question:

A lottery ticket states that you will receive $250 every year for the next ten years.
a. What is the value of the winning lottery ticket in present value if the is 6%, and it is an ordinary What is the value of the winning lottery ticket in present value if the is 6%, and it is an due?
c. What is the difference between the ordinary and due in parts (a) and (b)?
d. Verify that the difference in part (c) is the difference between the $250 first payment of the due and the discounted final $250 payment of the ordinary Annuity
An annuity is a series of equal payment made at equal intervals during a period of time. In other words annuity is a contract between insurer and insurance company in which insurer make a lump-sum payment or a series of payment and, in return,... Discount Rate
Depending upon the context, the discount rate has two different definitions and usages. First, the discount rate refers to the interest rate charged to the commercial banks and other financial institutions for the loans they take from the Federal...