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1. a) b) c) Mrs. Crawford will receive $8,500 a year for the next 16 years from her trust. If a 13 percent interest rate
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a) b)
c)
Mrs. Crawford will receive $8,500 a year for the next 16 years from her trust. If a 13 percent interest rate is applied, what is the current value of the future payments? (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Present value Rita Gonzales won the $45 million lottery. She is to receive $1.6 million a year for the next 20 years plus an additional lump sum payment of $13 million after 20 years. The discount rate is 15 percent. What is the current value of her winnings? (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Present value Kilgore Natural Gas has a $1,000 par value bond outstanding that pays 11 percent annual interest. The current yield to maturity on such bonds in the market is 10 percent. Compute the price of the bonds for these maturity dates: (Do not round intermediate calculations. Round your final answers to 2 decimal places. Assume interest payments are annual.) Bond Price a. 40 years b. 25 years C. 3 yearStep by Step Solution
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