Carolyn Fields Has Just Won the State Lottery

question 151

Essay

Carolyn Fields has just won the state lottery.The state offers the following three payout options for after-tax prize money:
1.$50,000 per year at the end of each of the next six years
2.$300,000 (lump sum)now
3.$400,000 (lump sum)six years from now
Calculate the present value of each scenario using an 8% annual discount rate.Round to nearest whole dollar.
Present value of an ordinary annuity of $1:

Present value of $1:

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Definitions:

Psychoanalytic Therapists

Professionals who use techniques based on psychoanalytic theories that aim to explore the unconscious mind motivations, conflicts, and to treat psychological disorders.

Humanistic Therapists

Professionals in psychology who emphasize an individual's inherent drive towards self-actualization and creativity, focusing on the client's perspective and potential.

Psychodynamic Therapist

A mental health professional who applies psychodynamic theories to help patients explore the psychological roots of their emotional distress.

Emotional Detachment

Emotional detachment refers to a state or ability to distance oneself emotionally from other people or situations that might otherwise cause emotional involvement.