In a message dated 6/17/06 1:10:50 PM US Mountain Standard Time,
peanuts.sweetbriar@yahoo.com writes:
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--- In <A HREF="mailto:vpFREE%40yahoogroups.com">vpFREE@yahoogroups.com</A>, GRAYTLEEGRAY@... wrote:
-- SNIP --
> Here are some questions:
> Who knows what value a 25 year/$40k annuity is worth in today's
dollars?
> That really is the Grand Prize.
>The present value of a stream of $40,000 payments for 25 years
depends on the discount rate. The present value at assorted
reasonable interest rates follows:4.00% - $649,879
4.50% - $619,819
5.00% - $591,946
5.50% - $566,068
6.00% - $542,014As you can see, as the assumed discount rate increases the lump sum
value decreases. If they (Harrahs) attempt to use what I consider to
be an unreasonable discount rate (like 8.00%) the lump sum value will
be even lower. For example, a rate of 8.00% results in a lump sum of
$461,150.Steve
******
Thanks Peanuts.
I sold my Cost Accounting textbook to go drink beer at one time...right
before final exams. Wait a minute...that is right after final exams.
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