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A very odd lottery offers the following annuity payment on the last day of each period. The payment amount is $5 ,000, and it will
A very odd lottery offers the following annuity payment on the last day of each period. The payment amount is $5 ,000, and it will be received 4 times per year. (hint; this is a regular annuity!) You will receive the periodic sum (annuity payment) for 16 years. You ask an investment adviser and they estimate your opportunity cost of funds to be 4.00% (nominal stated rate). At what instant payout would you be indifferent between the annuity and cash now? i.e. what is the present value of the annuity? (answer in $s, xxxx.xx w/ 2 decimal places.)
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