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The state lotterys million-dollar payout provides for $1.2 million to be paid in 25 installments of $48,000 per payment. The first $48,000 payment is made
The state lotterys million-dollar payout provides for $1.2 million to be paid in 25 installments of $48,000 per payment. The first $48,000 payment is made immediately, and the 24 remaining $48,000 payments occur at the end of each of the next 24 years. If 7% is the discount rate, what is the present value of this stream of cash flows? If 14% is rhe discount rate, what is the present value of the cash flows?
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