Calculate the present value of your prize in nominal terms


You win a lottery. The prize in nominal value is paid in 21 payments. The first payment of $0.55 million is paid to you today. The remaining 20 payments will be of equal value of $0.15 million per payment, and are going to be paid at the end of each year. The real interest rate is 3% per year. The inflation rate is 3% per year. Calculate the present value of your prize in nominal terms (Using the precise inflation rate formula).

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Financial Management: Calculate the present value of your prize in nominal terms
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