Jane won 10M and has the option of taking all her winnings today, or taking 1.2M today and 1.2M for the next 10 years. At what interest rate would make either option equally attractive. Group of answer choices 6% 8% 10% 12%
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Jane won 10M and has the option of taking all her winnings today, or taking 1.2M today and 1.2M for the next 10 years. At what interest rate would make either option equally attractive.
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8%
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12%
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- Jane won 10M and has the option of taking all her winnings today, or taking 1.2M today and 1.2M for the next 10 years. At what interest rate would make either option equally attractive. Group of answer choices 6% 8% 10% 12% Need Fast PlzzSally has won the grand prize in a lottery and must choose between the following three options: (hint: find the PV of each option) Receive a lump sum payment of $10,000,000. Receive annual end of the year payments of $2,000,000 for the next 8 years. Receive annual end of the year payments of $1,500,000 for the next 20 years. Which option should Sally choose based on an annual investment rate of 6%?As a prize, you are offered of one of the following three options:Option 1: $6,000 today, orOption 2: $8,500 in five years, orOption 3: $10,000 in seven years.Assuming you can earn 7% on your money, which option should you choose. (Brieflyexplain your choice and show all working to justify your answer.)
- Jenna is considering an investment which has a price of $16,000. She expects to receive $1,000 for 3 years, followed by $1,400 for another 4 years. At the end of the 7th year, Jenna expects to sell the investment for $25,000. If Jenna can borrow money at a rate of 10%, what is the investment's net present value? Select one: a. $4,849 b. $1,484 c. $2,650 d. $4,515Sally has won the grand prize in a lottery and must choose between the following three options: (hint: find the PV of each option) a. Receive a lump sum payment of $10,000,000. b. Receive annual end of the year payments of $2,000,000 for the next 8 years. c. Receive annual end of the year payments of $1,500,000 for the next 20 years. Which option should Sally choose based on an annual investment rate of 6%?Peter won a lottery and must decide among the following options: a. $260 at the beginning of every month for 5 years starting 3 years from now. b. $13,250 8.5 years from now. Money' is worth 3.4% compounded monthly. By how much the best option exceed the worst one, based on the present value of the offer?
- 1. Natalie won the lottery and is deciding between the options of receiving the annual payment option of $450,000 per year for 25 years beginning today, or receiving one lump-sum amount today. Natalie can earn 5% investing this money. At what lump-sum payment amount would she be indifferent between the two alternatives? (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)Sandy wants to go on a trip in 10 years. If she invests $1,000 per year at the end of each year for 10 years at a 12% interest rate, she will accumulate ____ to spend on her trip Group of answer choices $17,549. $15,105. $10,610. $16,710. $12,130.Jane Bauer has won the lottery and has the following four options for receiving her winnings: Receive $100,000 at the beginning of the current year Receive $108,000 at the end of the year Receive $20,000 at the end of each year for eight years Receive $10,000 at the end of each year for 30 years Jane can invest her winnings at an interest rate of 8% compounded annually at a major bank. Use the appropriate present or future value table: FV of $1, PV of $1, FV of Annuity of $1 and PV of Annuity of $1 Calculate the Present value for each of the above options. Round all answers to the nearest dollar. Present Value Option 1 $fill in the blank 1 Option 2 $fill in the blank 2 Option 3 $fill in the blank 3 Option 4 $fill in the blank 4 Which of the payment options should Jane choose?
- The winner of a $10,000,000 prize has the following payment choices. If the interest rate is 10%, which choice is best? Select one: a. $3,000,000 per year for 12 years b. $2,000,000 per year for 50 years c. $10,000,000 now d. $55,000,000 in 10 years e. All of choices are the sameAssume that Aliza has a winning lottery ticket and she are the given the option of accepting the value of P1,000,000 paying interest three years from now or taking the present value of the P1,000,000 now. The sponsor of the prize is using a 6% interest and discount rate. a. If she choose to receive the present value of the prize now, how much will she receive? b. If she choose to receive the value 3 years from now, how much will she receive? c. Which of the options will give her higher amount?Jim has just won the lottery. He is offered 2 choices to access his winnings. Choice A: $90,000 now, Choice B: $10,000 at the end of each year from year 1 to year 5 and $20,000 at the end of each year from year 6 to year 10. Find the discounted present value of these twochoices if the relevant interest rate is 8% per year and state the better choice for Jim?