1.Laura James just won the lottery of $2.5 million dollars.She is given two options to receive her winnings after tax deductions:

a)Take an annual payment for the next 10 years of $225,000; or

b)Take a lump sum three times.$1,000,000 up front, & $500,000 each at the end of year 5 & 10 respectively.

Requirement:Advise Laura on which option she should take based on your calculations using 5% interest rate.