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Calculate the present value of a $1,000 zero-coupon bond with 10 years to maturity if the required annual interest rate is 6.5%. A lottery claims
Calculate the present value of a $1,000 zero-coupon bond with 10 years to maturity if the required annual interest rate is 6.5%.
A lottery claims its grand prize is $25 million, payable over 25 years at $1,000,000 per year. If the first payment is made immediately, what is this grand prize really worth? Use a discount rate of 7%.
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