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Data Table - X Present Value of $1 Periods 4 1. 823 0.792 0.35 5 0. 784 O. TAT 0. 681 6 0. 745 0.705 0. 630 0. 71 1 0.583 0. 67T 0. 627 0.540 0. 6 45...

You won the lottery and have a number of choices as to how to take the money. Which choice yields a greater present​ value?


accounting hw2.png


A.

$83,000 ​(lump sum) 6 years from now using a 5​% discount rate


B.

$82,000 ​(lump sum) 6 years from now using an 6​% discount rate


C.

$47,000 ​(lump sum) now


D.

$7,000 a year at the end of each of the next 4 years using a 5​% discount rate

accounting hw2.png

Data Table
- X
Present Value of $1
Periods
4
1. 823
0.792
0. 7:35
5
0. 784
O. TAT
0. 681
6
0. 745
0.705
0. 630
0. 71 1
0.56.5
0.583
0. 67T
0. 627
0.540
0. 6 45
0.592
0.500
Print
DONE
Data Table*
- X
Present Value of Annuity of 5 1
9/6 5
Periods
3.545
3.46.5
3.312
4.329
4.212
3.993
6
5.076
4.917
4.623
5. 785
5.582
5. 206
5. 463
6. 210
5. 747
7. 108
6. 802
5. 247
Print
DONE

Top Answer

Select - Option - (A) ....... $83,000... View the full answer

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