23. Suppose you just won the state lottery, and you have a choice between receiving $2,550,000 today or a 20-year annuity of $250,000, with the first payment coming one year from today. What rate of return is built into the annuity? Disregard taxes. z 17.22

8

3.    The average American has $91 lying about. Stick $91 in an ordinary annuity account each year for 12 years at 4% interest compounded annually and watch it grow. What is the cash value of this annuity at the end of year 12?

118.) Your aunt Meg has given you perpetuity for your birthday. You will receive your first payment of $8000 one year from today. If the interest rate is 100%, what is the present value of your birthday gift?       $4000       $6000       $7000       $8000

Subject:- finance

vear fromLIow. urn I, Wa. the payments occurred i orever? 5. Caiculating Annuity Cash Flows. If you put up $20,000 today in exchange for a 8.5 percent, 12-year annuity, what will the annual cash flow be?

5. Present value of annuities and annuity payments The present value of an annuity is the sum of the discounted value of all future cash flows. You have the opportunity to invest in several annuities. Which of the following 10-year annuities has the greatest present value (PV)? Assume that all annuities earn the same positive interest rate. An annuity that pays $500 at the beginning of every six months An annuity that pays $1,000 at the end of each year An annuity that pays $500 at the end of every six months An annuity that pays $1,000 at the beginning of each year You bought an annuity selling at $2,867.74 today that promises to make equal payments at the beginning of each year for the next twelve years (N). If the annuity's appropriate interest rate (1) remains at 9.50% during this time, then the value of the annual annuity payment (PMT) is $375.00 You just won the lottery. Congratulations! The jackpot is $35,000,000, paid in twelve equal annual payments. The first payment on the…

Use the following 8% interest factors to answer the question below: Future Value of Ordinary Annuity. 8.92280 10.63663 12.48756 What amount should be recorded as the cost of a machine purchased December 31, 2023, which is to be financed by making 8 annual payments of $10,000? Each payment is made at the end of the period. The applicable interest rate is 8%. Present Value of Ordinary Annuity. 5.2064 5.7466 6.2469 7 periods 8 periods 9 periods hs

Suppose you just won the state lottery, and you have a choice between receiving $2,515,000 today or a 20-year annuity of $220,000, with the first payment coming one year from today. What rate of return is built into the annuity? Disregard taxes. O a. 6.88% O b. 12.96% O c. 6.04% O d. 5.69% O e. 8.75%

Aa.37.