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You have won the lottery. $ 7 5 0 million was the prize which will be paid in equal installments over the next 2 5
You have won the lottery. $ million was the prize which will be paid in equal installments over the next years so payments of $ million per year, starting today You also have the option to take a lump sum immediately which will be calculated based on the above payout using a dsicount rate of Assume that you have to pay a tax on your prize, what is the resulting payout after tax Hint: a discount does not mean the prize is less this is obviously a time value of money problem so think about what is given here and construct a timeline to properly account for the cash flows.
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