You have just received notification that you have won the @2 million first prize in the Centennial Lottery.
However, the prize will be awarded on you 100th birthday
(assuming you’re around to collect), 80 years from now. What is the present value of your windfall if the appropriate discount rate is 9 percent?
At 7% interest, how long does it take to double your money?
You’re trying to save to buy a new $160,000 Ferrari.
You have $25,000 today that can be invested at your bank.
The bank pays 3 percent annual interest on its accounts. How long will it be before you have enough to buy the car?
You expect to receive $25,000 at graduation in two years.
You plan on investing it at 9% until you have $160,000.
How long will you wait from now?