Ahmed Al Khatib has just won the lottery and must choose among three award options: lump sum of $61 million today 10 end-of-year payments of $9.5 million 30 end-of-year payments of $5.5 million If Ahmed can earn 7% annually, which option should he choose?   If Ahmed can earn 8% annually, which option should he choose?   If Ahmed can earn 9% annually, which option should he choose?   Explain how interest rates influence Ahmed’s choice.

Ellen won a lottery that will pay her $100,000 a year for 20 years, or she can accept $1,500,000 today.  A)Assuming she can earn 2.5% and maximizing her winnings is the only consideration, which offer should she accept? Show your calculations. B)Assuming she can earn 3%, what would be the lump sum today equivalent to the 20 payments of $100,000?

A 24-year-old December 2019 graduate has decided he wants the equivalent of $2,500,000 in January 1, 2020 buying power to be available exactly 40 years later on January 1, 2060. He plans to make his first investment of $Z on January 1, 2021 and every year thereafter, with the last payment of $Z on January 1, 2060. He can earn 8% on his money and expects inflation to run 5%. Solve, a. How many actual dollars will there be in his account immediately after his last deposit? b. What is $Z?

Marco is 45 years old and plans to retire at age 66. He wants you to assume he will be retired for 18 years before he dies. Assume Marco needs $50,504 at the beginning of the first year of retirement. Use an investment return of 7 percent and an inflation assumption of 3 percent. What amount of money will he need to have saved at the beginning of retirement? (Round any interest rate calculations to 4 decimal places e.g. .0125 for 1.25% and round the final answer to 2 decimal places)

Jacob wishes to borrow $80,000 from his bank, J.P. Morgan, in order to expand his business. J. P. Morgan agrees to lend him the money over a 5-year term at an APR of 8% and will accept either annual, quarterly, or monthly payments with no change in the quoted APR. Calculate the periodic payment under each alternative and compare the total amount paid each year under each option. Which period should Jacob choose and why? Show your calculations using a formula.

Anthony has just won the Flyball Lottery. He has two options for receiving his prize. The first option is to accept a $133,000 cash payment today. The second option is to receive $20,000 at the end of each of the next 19 years and a $33,500 lump sum payment in the 20th year. Anthony can invest money at a 11% rate. Click here to view the factor table. (a) Calculate the present value of the two options. (For calculation purposes, use 4 decimal places as displayed in the factor table provided and round final answer to 0 decimal place, e.g. 58,971.) Option 1 Option 2 Present value $ $ Which option should Anthony choose to receive his winnings? Option 2 Option 1 (b) If Anthony could invest money at 14%, calculate the present value of the two options. (For calculation purposes, use 4 decimal places as displayed in the factor table provided and round final answer to 0 decimal place, e.g. 58,971.) Option 1 Option 2 Present value $ $ Which option should he choose?

Bert plans to invest $5,120.00 in 3 years and $3,970.00 in 5 years. He expects to earn 8.59 percent per year. How much money does Bert expect to have in 11 years? O $15,822.62 (plus or minus 10 dollars) O $11,077.78 (plus or minus 10 dollars) O $16,408.17 (plus or minus 10 dollars) O $14,911.77 (plus or minus 10 dollars) O none of the answers are within 10 dollars of the correct answer