Problem 3.John has won a lottery and will receive $1000 every two years for the next 20 years. The first payment is due to be paid exactly 4 months from today. He has offered to sell the payments to you and has agreed to accept 8% APY for exchange. What is the price you must pay to John?
Thursday, February 3, 2011
John won lottery -Annual Percentage Yield
Problem 3.John has won a lottery and will receive $1000 every two years for the next 20 years. The first payment is due to be paid exactly 4 months from today. He has offered to sell the payments to you and has agreed to accept 8% APY for exchange. What is the price you must pay to John?
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