Question: You have a choice between receiving (1) A $50,000 payment today, (2) A $7,500 annuity for the next 10 years and a lump-sum amount of

You have a choice between receiving

(1) A $50,000 payment today,

(2) A $7,500 annuity for the next 10 years and a lump-sum amount of $20,000 at the end of the10th year. If money is worth 10%, which option is the most attractive?

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The second option is the most attractive because you would earn 139528 instead of 129700 1 ... View full answer

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