Peggy just won the lottery! She could either receive $75,000 today or $1,000,000 in 40 years. At what rate of interest, compounded annually, would Peggy be indifferent between accepting the lottery winnings of $75,000 today and investing it on her own?  A) 6.7% B) 6.1% C) 5.5% D) 2.4%

10. Tracy won a scholarship which pays $5,000 per year for the next three 3 years beginning a year from today. What is the present value of the scholarship using a discount rate of 7%? 11. Jason will receive $8,500 a year for the next 15 years. Assuming an interest rate of 7%, calculate the present value of the future payments if first receipt occurs today?

A) When Liam Corbett was born, his grandparents opened a 529 college savings plan for him so that he had enough money to pay for college once he turned 18. His college education is expected to cost $225,000 on the day he turns 18 years old. Determine if there will be enough in the account given the following assumptions (Show your calculations): Assumption #1: The grandparents contribute $6,200 per year starting the day Liam is born and the account earns an average annual rate of return of 7%. Assumption # 2: The grandparents contribute $5,000 per year starting the day Liam is born and the account earns an average annual rate of return of 7%. Assumption # 3: The grandparents contribute $5,000 per year starting the day Liam is born and the account earns an average annual rate of return of 9%. Assumption #4: The grandparents contribute $8,500 per year starting the day Liam is born and the account earns an average annual rate of return of 4%. Assumption # 5: The grandparents contribute…

Only by formula please!!! Linda is saving for retirement and would like to accumulate $750,000 at her retirement. She currently has $40,000 saved and would like to work for another 30 years. She plans to save $5000 at the end of each year over the next 30 years. What rate of return must she earn on her investments over the next 30 years?