You just won a lottery and are offered the following two payment options: Plan A: receive $100,000
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Question:
You just won a lottery and are offered the following two payment options: Plan A: receive $100,000 now Plan B: receive $1,000 every month for 10 years. The first payment will start in one month. The required rate of return is 5% APR. Which plan has the higher value?
A. Plan A
B. Plan B
C. The two plans have the same value.
D. More information is needed to determine.
E. None of the above
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