Solution-Implicit discount rate is the mega millions

Implicit discount rate is the mega millions

Reference no: EM132157030

The Mega Millions grand prize was recently $1,600,000,000. The prize has two different options:

- Receive a cash payment of $904,000,000, or

- Receive equal payments each year for 30 years, with the first payment paid immediately. Those annual payments are $53,333,333.

Given these facts, what implicit discount rate is the Mega Millions management assuming?

Reference no: EM132157030

Questions Cloud

What is fpi optimal capital budget : FPI is at its optimal capital structure, which is 40 percent debt and 60 percent equity, and the firm's marginal tax rate is 40 percent

What is the dividend for the 1st year : What is the dividend for the 1st year? (Round answer to 3 decimal places, e.g. 15.250.)

Susan holding period return : What was Susan's holding period return(HPR), annual percentage rate(APR), and compound annualized return, respectively?

Hiring employees at a steady rate : A growing company has been hiring employees at a steady rate of 1 new hire per month. The company started with 2 employees.

Implicit discount rate is the mega millions : Given these facts, what implicit discount rate is the Mega Millions management assuming?

Calculate xyz company budgeted selling expenses : From the information provided, calculate XYZ Company's budgeted selling expenses for the coming year.

Find out the cost of tuition and inflation : If I was wanting to find out the cost of tuition and inflation is involved, would I add the percentage of inflation each year to the total cost of the college

Effect of such a stock dividend on the following : What would be the effect of such a stock dividend on the following?

What are mirr strengths and weaknesses : Describe the modified internal rate of return (MIRR) as a method for deciding the desirability of a capital budgeting project. What are MIRR's strengths

User Account

All Pages

Implicit discount rate is the mega millions

Reference no: EM132157030

Reference no: EM132157030

Questions Cloud

Reviews

Write a Review

Finance Basics Questions & Answers

Financial reporting and analysis

A report on financial accounting

Describe the types of financial ratios

Differences between sole proprietorship and corporation

Prepare a cash budget statement

What are the implied interest rates

State pricing theory and no-arbitrage pricing theory

Small business administration

Effect of financial leverage

Evaluate the basis for the payment to the lender

Importance of opps, ipps, mpfs and dmepos

Time value of money

Assured A++ Grade

Academics

Major Subjects

Majors

Get In Touch

TERMS & POLICIES

HELP & SUPPORT