Author Question: You just won the Publisher's Clearing House Sweepstakes and the right to 20 after-tax ordinary ... (Read 72 times)

jazziefee

  • Hero Member
  • *****
  • Posts: 505
You just won the Publisher's Clearing House Sweepstakes and the right to 20 after-tax ordinary annuity cash flows of 163,291.18. Assuming a discount rate of 7.50, what is the present value of your lottery winnings?
 
  Use a calculator to determine your answer.
  A) 3,265,823.60
  B) 1,789,520.81
  C) 1,664,670.52
  D) There is not enough information to answer this question.

Question 2

Which of the following parity conditions is (are) correct?
 
  A) The purchasing-power parity theory states that in the long run exchange rate changes tend to
  reflect international differences in inflation rates.
  B) The interest-rate parity theory states that the forward premium/discount should be equal and
  opposite in size to the national interest rate differential.
  C) The international Fisher effect states that national interest rate differentials are the result of
  inflation differentials.
  D) All of the above are correct.



kkenney

  • Sr. Member
  • ****
  • Posts: 352
Answer to Question 1

Answer: C
Explanation: C) MODE = END
INPUT 20 7.5 ? 163,291.18 0
KEY N I/Y PV PMT FV
CPT 1,664,670.52

Answer to Question 2

D



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
 

Did you know?

Thyroid conditions may make getting pregnant impossible.

Did you know?

Children of people with alcoholism are more inclined to drink alcohol or use hard drugs. In fact, they are 400 times more likely to use hard drugs than those who do not have a family history of alcohol addiction.

Did you know?

Cyanide works by making the human body unable to use oxygen.

Did you know?

During the twentieth century, a variant of the metric system was used in Russia and France in which the base unit of mass was the tonne. Instead of kilograms, this system used millitonnes (mt).

Did you know?

Adults are resistant to the bacterium that causes Botulism. These bacteria thrive in honey – therefore, honey should never be given to infants since their immune systems are not yet resistant.

For a complete list of videos, visit our video library