In December 2012, a retired waitress in Massachusetts won a lottery of $5.6 million.  They can either give her a lump sum of $5.6 million or pay her $320,000 immediately and then $320,000 per year for the next 19 years. The time value of money to her is 8 percent. What choice will she make and why? (Ignore the tax effect).

Answer rating: 100% (QA)

To determine which option the retired waitress should choose we need to compare the present value of ... View the full answer