Suppose you just won the state lottery, and you have a choice between receiving $2,700,000 today or
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Question:
Suppose you just won the state lottery, and you have a choice between receiving $2,700,000 today or a 20-year annuity of $250,000, with the first payment coming one year from today. Assuming both choices have the same present value, what rate of return is built into the annuity? Disregard taxes.
Related Book For
Microeconomics An Intuitive Approach with Calculus
ISBN: 978-0538453257
1st edition
Authors: Thomas Nechyba
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