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Author Question: You own an oil well that will pay you $35,000 per year for9years, with the first payment being made ... (Read 65 times)

fungirl

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Question 1

You just won the lottery, and you have a choice between receiving $3,600,000 today or a9-year annuity of $510,000, with the first payment coming 1 year from today. What rate of return is built into the annuity?

5.02%


5.16%


6.43%


6.80%



Question 2

You own an oil well that will pay you $35,000 per year for9years, with the first payment being made today. If you think a fair return on the well is 8.8%, how much should you ask for if you decide to sell it?

$229,893


$230,167


$224,250


$235,463



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Marked as best answer by fungirl on Aug 7, 2023

Jaclyn92G6

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fungirl

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Reply 2 on: Aug 7, 2023
Thanks for the timely response, appreciate it


rachel

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Reply 3 on: Yesterday
Excellent

 

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