How much must the state invest now to guarantee the prize


A state's lottery winner is promised $200,000 a year for twenty years (starting at the end of the first year). How much must the state invest now to guarantee the prize if the state can earn annually 7 percent on its funds? How much must the state invest if the annual payments are to be made at the beginning of the year?

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Finance Basics: How much must the state invest now to guarantee the prize
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