What is the actual present value of your prize

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Question - You hit a half-court shot during a time-out at a UMass basketball game. The PA announcer congratulates you and informs that crowd that you just won $800,000! When you meet with the game staff, however, you learn that the $800,000 is paid in 20 annual payments of $40,000 each with the first one being made tonight after the game. Assuming a rate of 10.75%, what is the actual present value of your prize?

a. $103,804

b. $323,812

c. $358,622

d. $427,616

Reference no: EM132964683

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