Joseph has won a lottery prize. He will receive a payment of $ 1 2 0 ,
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Joseph has won a lottery prize. He will receive a payment of $ today. He will also receive payments at the end of each of the next years. These payments will grow by per year, iIt is the payment one year from today will be more than the payment today, the payment two years from today will be more than the payment one year from today, etc. What is the total present value of the prize that Joseph has won, given a discount rate of per year.
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We can calculate the total present value of Josephs lottery prize using the concept of present value annuity and factoring in the growing payments Her... View the full answer
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