Determine what is the present value of stream of payments

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Question 1) Lotta Dough just won the state lottery and has elected to receive $50,000 per year for 20 years in the form of an annuity due. What is the present value of this stream of payments if money can earn 7 percent annual interest?

Question 2) A. How much will you have in a Roth IRA if you invest $5,000 a year for 35 years, if money earns 6 percent, and you make the investment at the beginning of each year?

B. How much will you have in a Roth IRA if you invest $5,000 a year for 35 years, if money earns 6 percent, and you make the investment at the end of each year?

Reference no: EM132585009

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