You Just Won the Magazine Sweepstakes and Opted to Take

question 67

Multiple Choice

You just won the magazine sweepstakes and opted to take unending payments. The first payment will be $50,000 and will be paid one year from today. Every year thereafter, the payments will increase by 2.5 percent annually. What is the present value of your prize at a discount rate of 7.9 percent? 

• A) $1,350,000.00 
• B) $1,348,409.50 
• C) $925,925.93 
• D) $891,006.67 
• E) $846,918.22 

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Definitions:

Conglomerate Merger

The merger of two organizations competing in different markets.

Different Markets

Refers to various types of markets or platforms where goods, services, or securities are exchanged, including but not limited to geographic, demographic, or product-based distinctions.

Cultural Assimilation

is the process by which individuals or groups from one culture absorb and integrate the cultural attributes of a dominant or surrounding society.

Cultural Integration

The process where individuals from different cultural backgrounds come to live together harmoniously, sharing and adopting values, traditions, and norms.