A friend gave you a lottery ticket that matched all six numbers
so you are now the proud owner of an annuity for the lottery
jackpot. The jackpot was $150,000,000, which will be
paid out as annual payments over 25 years via a payment of
$6,000,000 at the end of each year. If the current
interest rate for risk-free annuities is 4.5%, compounded annually,
what lump sum amount today would equal the present value of this
25-year annuity.
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