The prize in last week's Florida lottery was estimated to be worth $35 million. If you were

Question:

The prize in last week's Florida lottery was estimated to be worth $35 million. If you were lucky enough to win, the state will pay you $1.75 million per year over the next 20 years. Assume that the first installment is received immediately.
a. If interest rates are 8 percent, what is the present value of the prize?
b. If interest rates are 8 percent, what is the after 20 years?
c. How would your answers change if the payments were received at the end of each year?
Future Value
Future value (FV) is the value of a current asset at a future date based on an assumed rate of growth. The future value (FV) is important to investors and financial planners as they use it to estimate how much an investment made today will be worth...