Question: You have just won the lottery You will receive
You have just won the lottery. You will receive $ 2,500,000 today, and then receive 40 payments of $ 1,250,000. These payments will start one year from now and will be paid every six months. A representative from Greenleaf Investments has offered to purchase all the payments from you for $ 23 million. If the appropriate interest rate is a 9 percent APR compounded daily, should you take the offer? Assume there are 12 months in a year, each with 30 days.
Answer to relevant QuestionsWhat is the value of an investment that pays $ 30,000 every other year forever, if the first payment occurs one year from today and the discount rate is 13 percent compounded daily? What is the value today if the first ...Ben Bates graduated from college six years ago with a finance undergraduate degree. Although he is satisfied with his current job, his goal is to become an investment banker. He feels that an MBA degree would allow him to ...An investment project provides cash inflows of $ 840 per year for eight years. What is the project payback period if the initial cost is $ 3,200? What if the initial cost is $ 4,800? What if it is $ 7,300?Consider the following cash flows on two mutually exclusive projects for the Bahamas Recreation Corporation (BRC). Both projects require an annual return of 14 percent.As a financial analyst for BRC, you are asked the ...You are evaluating a project that costs $ 75,000 today. The project has an inflow of $ 155,000 in one year and an outflow of $ 65,000 in two years. What are the IRRs for the project? What discount rate results in the maximum ...
Post your question