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(c) You just won a lottery that promises to pay you RM1,000,000 exactly 10 years from today. Because the RM1,000,000 payment is guaranteed by the

(c) You just won a lottery that promises to pay you RM1,000,000 exactly 10 years from today. Because the RM1,000,000 payment is guaranteed by the state in which you live, opportunities exist to sell the claim today for an immediate lump-sum cash payment. What is the least you will sell your claim for if you could earn the following rates of return on similar-risk investments during the 10-year period? (6 marks) (i) 6 % (ii) 9 % (iii) 12 %

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