The Caldwell Herald newspaper reported the following story. Frank Ormsby of Caldwell is the state's newest millionaire. By choosing the six winning numbers on last week's state lottery, Mr. Ormsby won the week's grand prize totaling $1.6 million. The State Lottery Commission indicated that Mr. Ormsby will receive his prize in 20 annual installments of $80,000 each. Click here to view Exhibit 13.1 and Exhibit 13B 2. to determine the appropriate discount factor(s) using tables Required: 1. If Mr. Ormsby can invest money at a 12% rate of return, what is the present value of his winnings? (Enter your answer in dollars and not in millions of dollars.) Present value EXHIBIT 13B-1 Present Value of their Periods 1 2 3 4 5 4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 14% 15% 16% 17% 18% 19% 20% 21% 22% 23% 24% 25% 0.962 0.952 0.943 0.935 0926 0.917 0.909 0.901 0.893 0.885 0.877 0.870 0.862 0.855 0.847 0.840 0.833 0.826 0.820 0.813 0.806 0.800 0.925 0.907 0.890 0.873 0.857 0.842 0.826 0.812 0.797 0.783 0.769 0.756 0.743 0.731 0.718 0.706 0.694 0.683 0.672 0.661 0.650 0.640 0.889 0.864 0.840 0.816 0.794 0.772 0.751 0.731 0.712 0.693 0.675 0.658 0.641 0.624 0.509 0.593 0.579 0.564 0.551 0.537 0.524 0.512 0.855 0.823 0.792 0.763 0.735 0.708 0.683 0.659 0.636 0.613 0.592 0.572 0.552 0.534 0.516 0.499 0.482 0.467 0.451 0.437 0.423 0.410 0.822 0.784 0.747 0.713 0.681 0.650 0.621 0.593 0.567 0.543 0.519 0.497 0.476 0.456 0.437 0.419 0.402 0.386 0.370 0.355 0.341 0.328 6 7 8 9 10 0.790 0.746 0.705 0.666 0.630 0.596 0.564 0.535 0.507 0.480 0.456 0.432 0.410 0.390 0.370 0.352 0.335 0.319 0.303 0.289 0.275 0.262 0.760 0.711 0.665 0.623 0.583 0.547 0.513 0.482 0.452 0,425 0.400 0.376 0.354 0.333 0.314 0.296 0.279 0.263 0.249 0.235 0.222 0.210 0.731 0.677 0.627 0.582 0.540 0.502 0.467 0.434 0.404 0.376 0 351 0.327 0.305 0.285 0.266 0.249 0.233 0.218 0.204 0.191 0.179 0.168 0.703 0.645 0.592 0.544 0.500 0.460 0.424 0.391 0.361 0.333 0.308 0.284 0.263 0.243 0.225 0.209 0.194 0.180 0.167 0.155 0.144 0.134 0.676 0.614 0.558 0.508 0.463 0.422 0.386 0.352 0.322 0.295 0.270 0.247 0.227 0.208 0.191 0.176 0.162 0.149 0.137 0.126 0.116 0.107 11 12 13 14 15 0.650 0.585 0.527 0.475 0.429 0.388 0.350 0.317 0.287 0.261 0.237 0.215 0.195 0.178 0.162 0.148 0.135 0.123 0.112 0.103 0.094 0.086 0.625 0.557 0.497 0.444 0.397 0.356 0.319 0.286 0.257 0.231 0.208 0.187 0.168 0.152 0.137 0.124 0.112 0.102 0.092 0.083 0.076 0.069 0.601 0.530 0.469 0415 0.368 0.326 0.290 0.258 0.229 0.204 0.182 0.163 0.145 0.130 0.116 0.104 0.093 0.084 0.075 0.068 0.061 0.055 0.577 0.505 0.442 0.388 0.340 0.299 0.263 0.232 0.205 0.181 0.160 0.141 0.125 0.111 0.099 0.088 0.078 0.069 0.062 0.055 0.049 0.044 0.555 0.481 0.417 0.362 0.315 0.275 0.239 0.209 0.183 0.160 0 140 0.123 0.108 0.095 0.084 0.074 0,065 0.057 0.051 0.045 0.040 0.035 16 0534 0.458 0.394 0.339 0.292 0.252 0.218 0.188 0.163 0.141 0.123 0.107 0.093 0.081 0.071 0.062 0.054 0.047 0.042 0.036 0.032 0.028 17 0.513 0.436 0.371 0.317 0.270 0.231 0.198 0.170 0.146 0.125 0.108 0.093 0.000 0.069 0.060 0,052 0.045 0.039 0.034 0.030 0.026 0.023 18 0.494 0.416 0.350 0.296 0.250 0.212 0.180 0.153 0.130 0.111 0.095 0.081 0.069 0.059 0.051 0.044 0.038 0.032 0.028 0.024 0.021 0.018 19 0 .475 0.396 0.331 0.277 0.232 0.194 0.164 0.138 0.116 0098 0.003 0.070 0 060 0,051 0.043 0.037 0.031 0.027 0.023 0.020 0.017 0.014 20 0.456 0.377 0.312 0.258 0.215 0.178 0.149 0.124 0.104 0.087 0.073 0.061 0.051 0.043 0.037 0.031 0.026 0.022 0.019 0.016 0.014 0.012 21 0.439 0.359 0.294 0,242 0.199 0.164 0.135 0.112 0.093 0.077 0.064 0.053 0.044 0.037 0.031 0.026 0.022 0.018 0,015 0,013 0.011 0.009 22 0.422 0.342 0.278 0.226 0.184 0.150 0.123 0.101 0,083 0068 0.056 0.046 0.039 0,032 0.026 0,022 0.018 0.015 0.013 0011 0009 0.007 23 0.406 0.326 0.262 0.211 0.170 0.138 0.112 0.091 0,074 0060 0049 0.040 0.033 0.027 0.022 0.018 0.015 0,012 0.010 0.009 0.007 0.006 24 0.390 0.310 0.247 0.197 0.15 0.126 0.102 0082 0.066 0.053 0.043 0.035 0.028 0.023 0.019 0.015 0.013 0.010 0.008 0.007 0.006 0.005 25 0.375 0.295 0.233 0.184 0.146 0.116 0.002 0.074 0.059 0.047 0.038 0.030 0.024 0.020 0.016 0.013 0.010 0.009 0.007 0.006 0.005 0.004 26 0.361 0.281 0.220 0.172 0.135 0.106 0.084 0.066 0.053 0.042 0.033 0.026 0.021 0.017 0.014 0.011 0.009 0.007 0.006 0.005 0.004 0.003 27 0.347 0.268 0.207 0.161 0.125 0.098 0.076 0.060 0047 0037 0020 0023 0.018 0.014 0.011 0.000 0.007 0.006 0.005 0.004 0.003 0.002 28 0.333 0.255 0.196 0.150 0.116 0.090 0.069 0.054 0.042 0033 0.025 0.020 0,016 0.012 0.010 0.008 0.006 0.005 0.004 0.003 0.002 0.002 29 0.321 0.243 0.185 0.141 0.107 0.082 0.063 0.048 0.037 0.029 0022 0.017 0014 0011 0008 0.006 0.005 0.004 0.003 0.002 0.002 0.002 30 0.308 0.231 0.174 0.131 0.099 0.075 0.057 0.044 0.033 0.026 0.020 0,015 0,012 0.009 0.007 0.005 0.004 0.003 0.003 0.002 0.002 0.001 40 0.208 0.142 0.097 0.067 0.046 0.032 0.022 0.015 0.011 0.008 0.005 0.004 0.003 0.002 0.001 0.001 0.001 0.000 0.000 0.000 0.000 0.000 EXHIBIT 133-2 Present Value of an Annuity of $1 in Arrears: - Periods 4% 5% 6% 7% 8% 9% 10% 11% 12% 13% 14% 15% 16% 17% 18% 19% 20% 21% 22% 23% 24% 25% 1 2 0.962 0.952 0.943 0.935 0.926 .917 0.909 0.901 0.893 0.885 0.877 0.870 0 862 0.855 0.847 0.840 0.833 0.826 0.820 0.813 0.806 0.800 1.886 1.859 1.833 1.808 1.783 1.759 1.736 1.713 1.690 1.668 1.647 1626 1.605 1.585 1.566 1.547 1.528 1.509 1.492 1.474 1.457 1.440 2.775 2.723 2673 2624 2.577 2531 2.487 2.444 2.402 2.361 2.322 2.283 2246 2210 2.174 2.140 2.106 2.074 2.042 2.011 1.981 1.952 3.630 3.546 3.465 3.387 3.312 3.240 3.170 3.102 3.037 2.974 2.914 2.855 2.798 2.743 2.690 2.639 2.589 2.540 2.494 2.448 2.404 2.362 4.452 4.329 4.212 4.100 3.993 3.890 3.791 3.696 3.605 3.517 3.433 3.352 3.274 3199 3.127 3.058 2.991 2.926 2.864 2.803 2745 2.689 4 5 6 7 8 5242 5076 4917 4.767 4.623 4.486 4355 4231 4.111 3.998 3.889 3784 3685 3589 3.498 3.410 3326 3.245 3.167 3.092 3020 2951 6.002 5.786 5.582 5.389 5.206 5.033 4.868 4.712 4.564 4.423 4.288 4.160 4.039 3.922 3.812 3.706 3.605 3.508 3.416 3.327 3.242 3.161 6733 6.463 6.210 5971 5.747 5535 5.335 5.146 4.968 4.799 4.639 4.487 4344 4 207 4.078 3.954 3.837 3.726 3.619 3.518 3.421 3329 7,435 7 1096 802 6515 6247 5 995 5759 5537 5328 5 132 4 946 4772 4 607 4451 4.303 4.163 4031 3 905 3.786 3673 3566 3462 3.111 7.722 7360 7024 6710 6418 6.145 5 889 5.650 5.426 5 216 5019 4833 4659 4 494 4.339 4.192 4.054 3.923 3.799 3 682 3571 10 12 13 14 15 8.760 3306 7.887 7.499 7.1396 805 6.495 6.207 5 938 5.687 5.453 5.234 5029 4835 4.656 4 486 4.327 4.177 4.035 3.902 3.776 3.656 9.385 8.863 8.384 7.943 7.536 7.161 6.814 6.492 6.194 5.918 5.660 5.421 5.197 4.988 4.793 4.611 4.439 4.278 4.127 3.985 3.851 3.725 9.986 9.394 8.853 8.358 7.904 7487 7.103 6.750 6.424 6.122 5.342 5 582 5.342 5.118 4910 4.715 4.533 4.362 4. 203 4.053 3.912 3.780 10.563 9.899 9.295 8.745 8.244 7.786 7.367 6.982 6.628 6.302 6.002 5.724 5.468 5.229 5008 4 802 4.611 4.432 4.265 4.108 3.962 3.824 11.118 10.380 9.712 9.108 8559 8061 7606 7191 5811 5.452 6.142 5.847 5 575 5 324 5.092 4875 4.675 4.489 4.315 4.153 4.001 3.859 16 11.652 10.838 10.106 9.447 8.851 8.313 7.824 7.379 6,974 6,604 6.265 5.954 5.668 5.405 5.162 4.938 4.730 4.536 4.357 4.189 4.033 3.887 17 12.166 11.274 10.477 9.763 9.122 8.544 8.022 7.549 7.120 6.729 6.373 6.047 5.749 5.475 5.222 4.990 4.775 4.576 4.391 4.219 4.059 3.910 18 12 559 11.690 10 828 10 0599372 8.756 8 201 7.702 7.250 6 8.40 6.467 612 5818 5 534 5 273 5033 4812 4 608 4419 4.243 4080 3.928 1913 134 12.085 11.15B 10.336 9.604 8950 8.365 7839 7366 6 938 6 550 6 1985.827 5.584 5 316 5070 4843 4635 4.442 4.263 4,097 3.942 20 13.590 12.462 11.470 10.594 9818 9.129 8.514 7963 7.469 7025 6.623 6.259 5.929 5628 5.353 5 101 4.870 4.657 4.460 4.279 4.110 3.954 21 22 23 24 14.029 12.821 11.764 10.836 10.017 9292 8,649 8,075 7.562 7.102 6.687 6.312 5 973 5,665 5 384 5.127 4.891 4.675 4.476 4.292 4.121 3.963 14.451 13.163 12.042 11.061 10.201 9.442 8.772 8.176 7645 7.170 6.743 6.359 6011 5.696 5.410 5.149 4.909 4.690 4.488 4 302 4.130 3.970 14.857 13.489 12 303 11.272 10.371 9.580 8 883 8.266 7718 7.220 6.792 6.399 6,044 5.723 5.432 5.167 4925 4.703 4.499 4 311 4137 3.976 15 247 13 799 12 550 11.469 10.529 9707 8 985 2 348 7784 7283 6835 6.434 6073 5746 5 451 5.182 4.937 4.713 4.507 4318 4.143 3.981 15 622 14.094 12 783 11654 10 575 9823 9077 8.422 7343 7330 6.873 6.464 6 097 5.766 5.467 5.195 4 948 4.721 4.514 4.323 4.147 3985 25 29 15.983 14 375 13.003 11.826 10 810 9.929 9.161 8.488 7 896 7372 56 906 6.491 6118 5.783 5 480 5 206 4 956 4.728 4520 4 328 4.151 3.988 16.330 14.643 13 211 11.987 10 935 10.027 9.237 8.548 7943 7.409 6 935 6514 6.136 5.798 5.492 5 215 4.964 4.734 4.524 4.332 4.154 3.990 15 663 14 89B 13.406 12.137 11051 10.116 9307 R 602 7084 7.441 5951 6534 6.152 5810 5.502 5.223 4.970 4.739 4.528 4.335 4.157 3.992 16.984 15.141 13.591 12.278 11.158 10.198 9.370 8.650 8 022 7.470 5 983 6551 6.166 5.820 5 510 5229 4.975 4.743 4.531 4 337 4.159 3.994 17.292 15.372 13.765 12.409 11 258 10.274 9.427 8.694 8.055 7.496 7.003 6.566 6.177 5.829 5.517 5.235 4.979 4.746 4.534 4.339 4.160 3.995 19.793 17.159 15.046 13.332 11.925 10.757 9.779 8.951 8.244 7.634 7.105 6.642 6.233 5.871 5.548 5 258 4 997 4.760 4.544 4.347 4.166 3.999 40