Essay
You win the $20 million state lottery,and you have a choice of taking an amount of money per year for the next 20 years or a flat payment now.The flat payment that the state offers you is $9.82 million.
a.What discount rate is the state using?
b.Should you take the money or the annuity?
Correct Answer:
Verified
a.8% (This is essentially the internal r...View Answer
Unlock this answer now
Get Access to more Verified Answers free of charge
Correct Answer:
Verified
View Answer
Unlock this answer now
Get Access to more Verified Answers free of charge
Q49: A drawback in using the payback approach
Q50: The risk adjusted discount rate<br>A)is the sum
Q51: A proposed project should be accepted if
Q52: Probabilities,which are based on past data or
Q53: A source of business risk is a
Q55: An aircraft company has signed a contract
Q56: If an expansion proposal is accepted,allowing an
Q57: A project whose acceptance eliminates another project
Q58: What are the major sources of risk
Q59: The internal rate of return equals the