Question
The Clearinghouse Sweepstakes has just informed you that you have won $1 million. The amount is to be paid out at the rate of $20,000
The Clearinghouse Sweepstakes has just informed you that you have won $1 million. The amount is to be paid out at the rate of $20,000 a year for the next 50 years. With a discount rate of 8 percent, what is the present value of your winnings? PLEASE SHOW YOUR WORK.
Peter Smith invests in a stock that will pay dividends of $2.00 at the end of the first year; $2.20 at the end of the second year; and $2.40 at the end of the third year. Also, he believes that at the end of the third year he will be able to sell the stock for $33. What is the present value of all future benefits if a discount rate of 10 percent is applied? (Round all values to two places to the right of the decimal point.). PLEASE SHOW YOUR WORK
Sara has invested $100,000 in an account at her local bank. The bank will pay her a constant amount of $21,960.71each year for 6 years, starting one year from today, and the account's balance will be 0 at the end of the sixth year, what is the rate of return (%) on the investment? (Round to two places to the right the decimal point) PLEASE SHOW YOUR WORK.
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