Suppose you win the lottery. You have a choice between receiving $100,000 a year for 20 years
Question:
a. Which should you choose if the interest rate is 3 percent? If it is 6 percent?
b. For what range of interest rates should you take the immediate payment?
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Step by Step Answer:
a For both interest rates you need to figure out the present value of the 20 annual payments of 1000...View the full answer
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