Question
Present Value Computation Kelly Fullerton won the state lottery and was given four choices for receiving her winnings. Receive $800,000 right now. Receive $832,000 in
Present Value Computation
Kelly Fullerton won the state lottery and was given four choices for receiving her winnings.
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Receive $800,000 right now.
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Receive $832,000 in one year.
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Receive $120,000 at the end of each year for eight years.
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Receive $46,400 at the end of each year for 30 years.
Assuming Kelly can earn interest of four percent compounded annually, which option should Kelly choose?
Use Excel or a financial calculator for computation. Round answers to the nearest dollar.
| (a) | 1. | Answer |
| (a) | 2. | Answer |
| (a) | 3. | Answer |
| (a) | 4. | Answer |
| (b) | AnswerOption 1Option 2Option 3Option 4 |
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Canadian Income Taxation Planning And Decision Making
Authors: Joan Kitunen, William Buckwold
17th Edition 2014-2015 Version
1259094332, 978-1259094330
