Bob lottery Inc. has decided to offer winnings a choice of $100,000 in 10 years
ID: 2405706 • Letter: B
Question
Bob lottery Inc. has decided to offer winnings a choice of $100,000 in 10 years or the some amount currently. Assuming that bobs lottery Inc Earn a 10 Percent after tax rate of return. What amount should bob offer lottery winners currently in order for him to be in different between the two choices.
In year 0, Eva took out a $50,000 home-equity loan from her local credit union. At the time she took out the loan, her home was valued at $350,000. At the time of the loan, Eva's original mortgage is $260,000. Unfortunately for Eva, during year 1, the value of her home dropped to $280,000 Consequently, as of the end of year 1, Eva's home secured $310,000 of home-related debt but her home is only valued at $280,000. Assuming Eva paid $15,000f mortgage on the home was $265,000. At the end of year 1, her original original mortgege and $3,500 of interest on the home-equity loan during the year,how much qualified residence interest can Eva deduct in year 1? ok nces Prev 2 of 5 NeExplanation / Answer
Future Value $100,000.00 Period 10 Years Rate 10.00% Present Value = $100000/(1+10%)^10 $38,554.33 Thus, Bob should offer lottery winners $38,554.33 today for him to be indifferent between the two choices