A losing side in a lawsuit offers a claimant two settlement options. The first is to receive $5,000 in 4 years, $10,000 in 8 years and $10,000 in 12 years. The second option is to receive $22,000 in 6 years. Assume the effective annual interest rate is 3.8%. 

Which option should the claimant take. Justify your answer with calculations

Answer rating: 100% (QA)

The claimant should take the second option to receive 22000 in 6 years To calculat... View the full answer