Most government lotteries pay out jackpots in the form of a twenty- or thirty-year annuity, but they

Question:

Most government lotteries pay out jackpots in the form of a twenty- or thirty-year but they also give winners the option to collect their winnings as a much smaller lump sum. Explain how you would use time value of money analysis to choose between the and the lump sum if you won the lottery.
Annuity
An annuity is a series of equal payment made at equal intervals during a period of time. In other words annuity is a contract between insurer and insurance company in which insurer make a lump-sum payment or a series of payment and, in return,...