Assume you won the big prize of “$20 million” on a game show. This prize will be paid out in one of three ways: 

(1) You can receive $1 million per year for the next 20 years, 

(2) You can have $8 million today, or 

(3) You can have $2 million today and receive $700,000 for each of the next 20 years. Your financial adviser tells you that it is reasonable to expect to earn 10 percent on investments. Which option do you prefer? What factors influence your decision?