Question
1. Congratulations! You just won the lottery for $3.75 million. You are given the option of receiving $1.8 million now or you can receive $150,000
1. Congratulations! You just won the lottery for $3.75 million. You are given the option of receiving $1.8 million now or you can receive $150,000 at the end of every year for 25 years. If you can earn 5% interest on your investments annually, what is the value of the annuity option?
Please show formulas and manual calculations (not using excel)
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Multinational Finance
Authors: Kirt C. Butler
3rd Edition
0324177453, 978-0324177459
