You have a choice between a lottery lump sum payout of $3,800,000 today or a series of twenty annual annuity due payments
At a discount rate of 6.00%, how large must the annual annuity due payments be to make you indifferent between the two choices? Use a calculator to determine your answer.
A) $331,301.32
B) $351,179.40
C) $190,000.00
D) $312,548.41
Answer: D
Explanation: D) MODE = BEGIN
INPUT 20 6.0 -3,800,000 ? 0
KEY N I/Y PV PMT FV
CPT 312, 548.41
You might also like to view...
Security, comfort, self-preservation, and personal pleasure are common psychological needs of buyers.
Answer the following statement true (T) or false (F)
Charismatic leaders may be especially likely to emerge during
a. times of crisis and great change b. times of great entrepreneurial opportunities c. stable, peaceful times d. both “a” and “b”
What is a rating transition matrix?
What will be an ideal response?
______ is a valid and sufficient offer of performance under a contract
a. Tender b. Sale c. Completion d. Delivery e. Termination