earlier this week the Big Game lottery jackpot hit 351$ million The winner will get 13.5 million a year for 6 years (with the first payment at time zero). But the winner will have to pay income taxes. After taxes if there is a single winning ticket the winner can choose a one time payoff of 114$million or 8.9$ million a year for 26 years.

a) what is the embedded rate of return associated with the two alternative modes of payoff?

b)Assume you won the Big Game lottery and wanted a payoff over time. if you thought you could earn 5 percent after tax on invested funds. which investement would you take and why?