Congratulations! You have just won the lottery. The lottery board offers you three different options for collecting your winnings:

1. You will receive payments of $500,000 at the end of each year for twenty years.

2. You will receive a lump-sum payment of $4,500,000 today.

3. You will receive a lump-sum payment of $1 million today and payments of $2,100,000 at the end of Years 5, 6, and 7.

Assume that all earnings can be invested at a 10 percent annual rate. Which option should you choose and why?