Your sister is the one lucky winner of the Ohio Lottery and is looking to you, as
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Question:
Your sister is the one lucky winner of the Ohio Lottery and is looking to you, as a Finance Major, to help out with some advice. Assuming market interest rates are at 6.50%, on a present value basis how would you consult with her about the choice to -a) take an annuity of $3,400 per month for 25 years, or -b) take an annuity of $3,750 per month for 20 years ? - how much is she better off by choosing the one you recommend, remembering that more is better? NOTE: There are 2 answers required, which is better and by how much.
Related Book For
Macroeconomics Principles, Applications, and Tools
ISBN: 978-0132555234
7th Edition
Authors: Arthur O Sullivan, Steven M. Sheffrin, Stephen J. Perez
Posted Date: