Crissie just won the lottery , and she must choose between three award options. She can elect to receive a lump sum today $61 million, to receive 10 end-of-year payments of $9.5 million, or to receive 30 end-of-year payments of $5.5 million.

a. If she thinks she can earn 7% annually, which should she choose?

b. If she thinks she can earn 8% annually, which should she choose?

c. If she thinks she can earn 9% annually, which should she choose?

d. Explain how interest rates influence the optimal choice.