Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Part B: Total pts =30. Show your calculations, or the entries in your financial calculator. 1. You just won $1,000,000 in a lottery. The winnings
Part B: Total pts =30. Show your calculations, or the entries in your financial calculator. 1. You just won $1,000,000 in a lottery. The winnings will be paid as an annuity of $50,000 per year starting next year for 20 years. You are given an option to receive it as a lump sum to be paid tandau How much is the lumb sum if interest rate is 8 percent per year? [10 pts] 2. You plan to have $200,000 in 10 years for education expenses. You are looking at an investment account with interest rate of 6.0 percent per year. How much should you save every month to reach your goal? [10 pts] 3. You have $50,000 today. You want to deposit this money in some account in order to have $100,000 in three years? At what annual percentage rate (APR) should you invest this money to achieve your goal? What is the effective annual rate (EAR) with monthly compounding? [10 pts]
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started