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Chuck has just won the Flyball Lottery. He has two options for receiving his prize. The first option is to accept a $128,000 cash payment
Chuck has just won the Flyball Lottery. He has two options for receiving his prize. The first option is to accept a $128,000 cash payment today. The second option is to receive $24,600 at the end of each of the next 13 years and a $21,400 lump sum payment in the 14th year. Chuck can invest money at a 6% rate. Click here to view the factor table. (a) Calculate the present value of the two options. (For calculation purposes, use 4 decimal places as displayed in the factor table provided and round final answer to 0 decimal place, e.g. 58,971.) Option 2 Option 1 128000 Present value $ Which option should Chuck choose to receive his winnings? Option 24 (b) If Chuck could invest money at 9%, calculate the present value of the two options. (For calculation purposes, use 4 decimal places as displayed in the factor table provided and round final answer to O decimal place, e.g. 58,971.) Option 1 Option 2 Present value $ Which option should he choose
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