1,John Jones won a lottery that will pay him $3800000 after eighteen years. Assuming an appropriate interest rate is 3% compounded annually, what is the present value of this amount?

Click here to view factor tables

$2232082.

$2052000.

$52263338.

2.At the end of two years, what will be the balance in a savings account paying 5% annually if $32000 is deposited today? The future value of one at 5% for one period is 1.05.

$33600

$35200

$32000

$35280

$6469234.

3.Multiple Choice Question 66

Given below are the future value factors for 1 at 10% for one to five periods. Interest is compounded annually at 10%.

Periods

Future Value of 1 at 10%

1

1.100

2

1.210

3

1.331

4

1.464

5

1.611

If $16200 is deposited in a savings account today, what amount will be available three years from today?

($16200 1.100) + ($16200 1.210) + ($16200 1.331)

$16200 1.100 3

$16200 1.331

$16200 1.331