You have won the lottery: The BernLotto offers you the following options for getting your payment: Option 1) Get a payment of 2 million at the end of years 1 and 2 and then 1.5 million every year forever. Option 2) An annuity of 3 million for 10 years (1st cash flow end of year 1) Option 3) An annuity of 2.25 million for 20 years (1st cash flow end of year 1) Option 4) An inmediate payment of 7.7205882 million The interest rate is: 17% What are the present values of: Answer in 4 decimals (example: 5.1234 )

Answer rating: 100% (QA)

To calculate the present values of the different options offered by Bern Lotto we will use the f... View the full answer