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8) Lottery prizes are often not worth as much as claimed. What is the present value of a prize of $5,000,000 that is to be
8) Lottery prizes are often not "worth" as much as claimed. What is the present value of a prize of $5,000,000 that is to be received in 20 equal yearly instalments, with the first payment beginning today? Assume an interest rate of 7% (The equal yearly payments will be equal to 5,000,000/20, in case the question was not clear. Also don't forget BGN mode) Explain your work
8) Lottery prizes are often not "worth" as much as claimed. What is the present value of a prize of $5,000,000 that is to be received in 20 equal yearly instalments, with the first payment beginning today? Assume an interest rate of 7%
(The equal yearly payments will be equal to 5,000,000/20, in case the question was not clear. Also don't forget BGN mode)
Explain your work
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