Fatimah just won a Game Online Competition 2021 conducted by Majlis Perbandaran Kajang. She now has a
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Question:
Fatimah just won a "Game Online Competition 2021" conducted by Majlis Perbandaran Kajang. She now has a choice between three alternatives. She can get RM100,000 now, or RM10,000 per year in perpetuity, or RM50,000 now and RM150,000 at the end of 10 years. Given the appropriate discount rate is 12%, which alternative should Fatimah choose? Explain your answer.
Alternative 1
RM100,000 now
Alternative 2
RM10,000 per year in perpetuity
Alternative 3
RM50,000 now and RM150,000 at the end of 10 years
Expert Answer:
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