Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Winners of the Dream a Dream Lotto draw are given the choice of receiving the winning amount divided equally over 21 years or as a

Winners of the Dream a Dream Lotto draw are given the choice of receiving the winning amount divided equally over 21 years or as a lump sum cash option amount. The cash option amount is determined by discounting the winning amount at 5 percent interest compounded quarterly over 21 years. This week the lottery is worth $9 million to a single winner. What would the lump-sum cash option payout be?(Use the time value of money formulas or the TI BAIl Plus financial calculator, and enter your answer rounded to the nearest cent.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Rich Dads Increase Your Financial IQ Get Smarter With Your Money

Authors: Robert T. Kiyosaki

1st Edition

1612680658, 978-1612680651

More Books

Students also viewed these Finance questions

Question

a. When did your ancestors come to the United States?

Answered: 1 week ago

Question

d. What language(s) did they speak?

Answered: 1 week ago

Question

e. What difficulties did they encounter?

Answered: 1 week ago