Assume that you have just won $5,000,000 in the lottery and will receive $250,000 per year for the next 20 yea

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Assume that you have just won $5,000,000 in the lottery and will receive $250,000 per year for the next 20 yea

Assume that you have just won $5,000,000 in the lottery and will receive $250,000 per year for the next 20 years. How much is your prize worth today if the interest rate is 8%?
$1,072,731
$2,454,525
$2,185,219
$1,165,250

2006-11-03 14:25:32 · 3 answers · asked by Helen C 1 in Games & Recreation ➔ Gambling

3 answers

1,165,250 Take 250,000 and multiply by 1.08 (which is the same as figuring tax and adding it to the total). Then do it 19 more times and you get 1165239. It's the closest answer.

2006-11-03 14:40:36 · answer #1 · answered by BeamMeUpMom 3 · 0⤊ 0⤋

Ditto that...none of the above!

2006-11-03 16:19:26 · answer #2 · answered by sweet ivy lyn 5 · 0⤊ 0⤋

NONE OF THE ABOVE...............

2006-11-03 14:33:07 · answer #3 · answered by cork 7 · 0⤊ 0⤋