Felice Lucas Has Just Won the State Lottery and Has

question 68

Multiple Choice

Felice Lucas has just won the state lottery and has the following three payout options for after-tax prize money:
1) $170,000 per year at the end of each of the next six years
2) $312,000 (lump sum) now
3) $508,000 (lump sum) six years from now
The annual discount rate is 9%.Compute the present value of the first option.(Round your answer to the nearest whole dollar. )
Present value of an ordinary annuity of $1:

Present value of $1:

• A)$850,000
• B)$762,620
• C)$482,000
• D)$457,251

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Definitions:

Broca's Aphasia

A neurological condition characterized by difficulties in producing speech due to damage to Broca's area in the frontal lobe of the brain, often leaving the individual able to understand language but with impaired speaking ability.

Impaired Recall

A diminished ability to remember or retrieve previously learned information.

Nouns

Words used to identify any of a class of people, places, or things.

Comprehension

The ability to understand the meaning or significance of something, such as a word, sentence, or text.