You and 11 coworkers just won $14 million ($1,166,666.67 each) from the state lottery. Assuming you...

Question

Question

You and 11 coworkers just won $14 million ($1,166,666.67 each) from the state lottery. Assuming you each receive your share o

business finance

Add a comment Improve this question Transcribed image text

Answer 1

Answer #1

Dear Student
Thank you for using homeworklib
Please find below the answer
Statement showing Computations
Particulars	Amount
Amount of lottery	1,166,666.67
Amount received per year =1,166,666.67/17	68,627.45
PVF for 17 Years	8.5436
PV of prize before taxes = 68,627.45*8.54363	586,328

Time	PVF at 9%
1.00	0.91743
2.00	0.84168
3.00	0.77218
4.00	0.70843
5.00	0.64993
6.00	0.59627
7.00	0.54703
8.00	0.50187
9.00	0.46043
10.00	0.42241
11.00	0.38753
12.00	0.35553
13.00	0.32618
14.00	0.29925
15.00	0.27454
16.00	0.25187
17.00	0.23107
PVF for 17 Years	8.54363

Add a comment

Answer 2

Similar Homework Help Questions

You and 11 coworkers just won $14 million ($1,166,666.67 each) from the state lottery. Assuming you...

You and 11 coworkers just won $14 million ($1,166,666.67 each) from the state lottery. Assuming you each receive your share over 17 years and that the state lottery earns a 8 percent return on its funds, what is the present value of your prize before taxes if you request the up-front cash' option? Click on the table icon to view the annuity table The present value of your prize before taxes if you request the 'up-front cash' option is S...
You and 11 coworkers just won $19 million ($1,583,333.33 each) from the state lottery. Assuming you...

You and 11 coworkers just won $19 million ($1,583,333.33 each) from the state lottery. Assuming you each receive your share over 17 years and that the state lottery earns a 5 percent return on its funds, what is the present value of your prize before taxes if you request the 'up-front cash' option? (Note: Also assume an ordinary annuity-payments made at the end of each period.) The present value of your prize before taxes if you request the 'up-front cash'...
You and 11 coworkers just won $18 million ($1,500,000.00 each) from the state lottery. Assuming you...

You and 11 coworkers just won $18 million ($1,500,000.00 each) from the state lottery. Assuming you each receive your share over 18 years and that the state lottery earns a 3 percent return on its funds, whatis the present value of your prize before taxes r you recu uest the 'up-front cash' option? Click on the table icon to view the annuity table The present value of your prize before taxes if you request the 'up-front cash' option is S...

You and 11 coworkers just won $18 million ($1,500,000.00 each) from the state lottery. Assuming you...

You and 11 coworkers just won $18 million ($1,500,000.00 each) from the state lottery. Assuming you each receive your share over 16 years and that the state lottery earns a 9 percent return on its funds, what is the present value of your prize before taxes if you request the up front cash option? (note: assume an ordinary annuity-- payment made at the end of each period) The present value of your prize before taxes if you request the up...
You and 11 coworkers just won $12 million ($1,000,000.00 each) from the state lottery. Assuming you...

You and 11 coworkers just won $12 million ($1,000,000.00 each) from the state lottery. Assuming you each receive your share over 16 years and that the state lottery earns a 4 percent return on its funds, what is the present value of your prize before taxes if you request the 'up-front cash' option? (Note: Also assume an ordinary annuity-payments made at the end of each period.)
You and 11 coworkers just won $5 million ($416,666.67 each) from the state lottery. Assuming you...

You and 11 coworkers just won $5 million ($416,666.67 each) from the state lottery. Assuming you each receive your share over 19 years and that the state lottery earns a 6 percent return on its funds, what is the present value of your prize before taxes if you request the 'up-front cash' option?

Congratulations! You have just won the State Lottery. The lottery prize was advertised as an annualized $105 million pai...

Congratulations! You have just won the State Lottery. The lottery prize was advertised as an annualized $105 million paid out in 30 equal annual payments beginning immediately. The annual payment is determined by dividing the advertised prize by the number of payments. Instead you could take a one lump cash prize of the present value of all the annuity payments using a 4.5% discount rate. You now have up to 60 days to determine whether to take the cash prize...
Gabrielle just won $3 million in the state lottery. She is given the option of receiving...

Gabrielle just won $3 million in the state lottery. She is given the option of receiving a of $1,400,000 now, or she can elect to receive $120,000 at the end of each of the next 25 years. If Gabrielle can earn 6% annually on her investments, which option should she take? If Gabrielle takes the prize as an annuity, the present value of the 25-year ordinary annuity is $ (Round to the nearest dollar.)
Gabrielle just won $2.75 million in the state lottery. She is given the option of receiving...

Gabrielle just won $2.75 million in the state lottery. She is given the option of receiving a total of $1,400,000 now, or she can elect to be paid $110,000 at the end of each of the next 25 years. If Gabrielle can earn 5% annually on her investments, from a strict economic point of view which option should she take? If Gabrielle takes the prize as an annuity, the present value of the 30-year ordinary annuity is $ . (Round...

Gabrielle just won $2.75 million in the state lottery. She is given the option of receiving...

Gabrielle just won $2.75 million in the state lottery. She is given the option of receiving a total of $1,400,000 now, or she can elect to be paid $110,000 at the end of each of the next 25 years. If Gabrielle can earn 65% annually on her investments, from a strict economic point of view which option should she take? If Gabrielle takes the prize as an annuity, the present value of the 30-year ordinary annuity is $ . (Round...

You and 11 coworkers just won $14 million ($1,166,666.67 each) from the state lottery. Assuming you...

Homework Answers