Prizes to have same present value

Assignment Help Financial Management

Reference no: EM131608682

As an employee in the Lottery Commission, your job is to design a new prize. Your idea is to create two grand prize choices: (1) receiving $50,000 at the end of each year beginning in one year for 20 consecutive years, or (2) receiving $500,000 today followed by a one-time payment at the end of 20 years. Using an interest rate of 3%, which of the following comes closest to the amount prize (2) needs to pay at the end of year 20 in order that both prizes to have the same present value?

Reference no: EM131608682

Questions Cloud

Interruption to one or more business processes : Contingencies generally can be expressed as an interruption to one or more business processes

Do you feel that arabs are unfairly depicted : Do you feel that Arabs are unfairly depicted in much of U.S. popular media and that this contributes to their being stereotyped and discriminated against

Healthcare workers are at a high risk for work injuries : Describe why you believe this is the case, and provide some possible solutions. If you have a friend or family member who works in the healthcare

In what sense is it not a good way to raise revenue : In what sense is taxing tobacco a "good" way to raise revenue? In what sense is it not a "good" way to raise revenue

Prizes to have same present value : which of the following comes closest to the amount prize (2) needs to pay at the end of year 20 in order that both prizes to have the same present value?

Compose a uniform criminal code : A group of attorneys, judges and law professionals have collaborated to compose a uniform criminal code.

Write a brief email on the vacation policy changes : Write a brief email on the vacation policy changes to be distributed to staff. You have just finished up and have sent your newly constructed email to the staff

Display both the issue and the point total : (Polling) The Internet and the web are enabling more people to network, join a cause, voice opinions, and so on. The U.S. presidential candidates in 2008 used.

The occupational safety and health administration : the National Institute of Occupational Safety and Health (NIOSH) and the American Conference of Governmental Industrial Hygienists

User Account

All Pages