A young man won the $1.6 billion Megamillion Jackpot Lottery in California. However, the winner cannot collect the money immediately. Two payment options: Half of the face value of the lottery paid in cash or 26 annual payments at the beginning of each year. If the annual interest rate is 5%, which payment option is better?

Answer rating: 100% (QA)

To determine which payment option is better we need to compare the present value of both options The ... View the full answer