Question 1

You just won the grand prize in the Super Pokemon Lotto and won 12 million pokecoins! (Current foreign exchange rate is 1 pokecoin = 1 US dollar). You will get paid 100,000 pokecoins per month for the next 10 years (120 months, get it?).

But youre a bit uneasy what if Pokemon isnt even around 10 years from now and they go bust, then maybe your future payments are at risk so you want to ask for a up-front lump sum amount instead of the monthly amounts spread over ten years. The Lotto organizers may be willing to give you that one-time all cash lump-sum payout right now. But how much should you ask then? (If you ask for 12 million pokecoins as the immediate lump-sum, of course they will toss you out as someone who never even took FIN 302 so you wont ask for that obviously).

A. What lump-sum amount do you ask for and why? Explain the logic behind your calculation. If the Lotto organizers dont understand your logic, they will reject you. Explain and discuss EACH component.

B. Explain it so they can understand why it makes sense for them to agree. In other words, can it be fair to both sides? Explain the factors (the pros and cons of each factor) and HOW these factors behave. (You know how many factors there are I just repeated it in class a hundred times Now explain how these behave and why, etc.)

C. What is the amount you are thinking? Again, how can it be transparent and reasonable for both sides? You dont have to have a super exact number, but more a general ballpark number (dont be too loose).

D. Anything else RELEVANT you may decide would be of interest to the organizers. But remember, this is FIN 302, not Philosophy 302 or Accounting 302 etc., etc. If you go sideways and explain why you love/dontknow pokemon or want to pay off your student debt, etc., the Lotto organizers dont give a damn (and you get zero points for that discussion). They are business folks and dont care whether its pokemon or poke-bowls, or whether you will spend it to save the rain forests or burn it all on blow and hooch, its not their concern so dont waste your time writing about that either. Money is money and business is business...