Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Basic Finance Expert

Assume the Mega Millions jackpot is $65 million payable in 25 equal annual installments of $2.6 million with the first payment payable at the end of the first year.

a. describe why the Present Discounted Value (PDV) of this jackpot is less than $65 million.

b. find out the PDV if the interest rate were 6 percent (i=0.06).

c. What is the PDV if the jackpot paid $2.6 million per year for ever?

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M938747

Have any Question? 


Related Questions in Basic Finance

Assignment lasa npv sensitivity risk bias and ethics in

Assignment: LASA: NPV, Sensitivity, Risk, Bias and Ethics in Capital Budgeting Investment projects should never be selected through purely mechanical processes. Managers should ask questions about the positive net presen ...

Explain why a yield curve can be negatively sloped would

Explain why a yield curve can be negatively sloped. Would interest rates be abnormally high or low? What would be the overall expectation of the direction of future short- term interest rates?

Impact of money supply growth explain why an increase in

Impact of Money Supply Growth Explain why an increase in the money supply can affect interest rates in different ways. Include the potential impact of the money supply on the supply of and the demand for loanable funds w ...

Provide a short discussion or definition of the following

Provide a short discussion or definition of the following terms: economics, finance, the financial system, net lenders, net borrowers, direct and indirect finance, financial markets, financial intermediaries, liquidity, ...

Instructions-1 need detailed answers2 long term financial

Instructions- 1. Need detailed answers 2. Long term financial plan should be 5 years 3. Revenue costs include stuff like salary 4. I need to submit it in turnitin so make sure no one submits it 5. Anything not clear ask ...

Les moore retired as president of goodman snack foods

Les Moore retired as president of Goodman Snack Foods Company but is currently on a consulting contract for $35,000 per year for the next 10 years. a. If Mr. Moore's opportunity cost (potential return) is 10 percent, wha ...

Suppose there is an unexpected slowdown in the rate of

Suppose there is an unexpected slowdown in the rate of productivity growth in the economy so that forecasters consistently overestimate the growth rate of GDP. If the central bank bases its policy decisions on the consen ...

Questionspart a -q1 reno revolvers has an eps of 180 a cash

Questions Part A - Q1. Reno Revolvers has an EPS of $1.80, a cash flow per share of $4.50, and a price/cash flow ratio of 9.0. What is its P/E ratio? Round your answer to two decimal places. Q2. ROE - Needham Pharmaceuti ...

Assignmentteaching net present value npv amp future value

Assignment Teaching Net Present Value (NPV) & Future Value (FV) You have been asked by a manager in your organization to put together a training program explaining Net Present Value (NPV) and Future Value (FV) and how th ...

Financediscussion 1multinational financial management

Finance Discussion 1 "Multinational Financial Management" Please respond to the following: • From the e-Activity, determine key reasons why a multinational corporation might decide to borrow in a country such as Brazil, ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

A cola-dispensing machine is set to dispense 9 ounces of

A cola-dispensing machine is set to dispense 9 ounces of cola per cup, with a standard deviation of 1.0 ounce. The manuf

What is marketingbullwhat is marketing think back to your

What is Marketing? • "What is marketing"? Think back to your impressions before you started this class versus how you

Question -your client david smith runs a small it

QUESTION - Your client, David Smith runs a small IT consulting business specialising in computer software and techno

Inspection of a random sample of 22 aircraft showed that 15

Inspection of a random sample of 22 aircraft showed that 15 needed repairs to fix a wiring problem that might compromise

Effective hrmquestionhow can an effective hrm system help

Effective HRM Question How can an effective HRM system help facilitate the achievement of an organization's strate