Question: Your grandmother died recently She named you as a beneficiary

Your grandmother died recently. She named you as a beneficiary on an insurance contract that will pay you $60,000 immediately. However, the contract gives you the alternative of taking $20,000 a year (end of year) for the next five years. You think that you will earn 6 percent on your investments over this period of time. Given this information, what is the better choice—immediate cash or the extended payout? Explain.

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  • CreatedMarch 19, 2015
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