2. Kelsey just won the lottery, and she must choose among three award options .She can elect to receive a lump sum today of $62 million, to receive end-of-month payments of $0.8 million for 10 years or to receive end-of month payments of $0.47 million for 30 years. If she can earn 8% annually (i.e., the discount rate is 8% per year), which is the best choice based on the PV of the three award options?

a) PV of 1^st award option:

b) PV of 2^nd award option:

                   N=                                I/YR=                          PMT=                      FV=                        PV=

c) PV of 3^rd award option

                    N=                                I/YR=                          PMT=                      FV=                        PV=

d) Which is the best choice for Kelsey?

Answer rating: 100% (QA)

To determine the best choice for Kelsey based on the present value PV of the three award options we ... View the full answer