19. As winner of a breakfast cereal competition, you can choose one of the following prizes: a....
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19. As winner of a breakfast cereal competition, you can choose one of the following prizes:
a. $100,000 now.
b. $180,000 at the end of five years.
c. $11,400 a year forever.
d. $19,000 for each of 10 years.
e. $6,500 next year and increasing thereafter by 5% a year forever.
If the interest rate is 12%, which is the most valuable prize?
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