John won the lottery and is faced with the following options:

1) Accept payment of $40,000 per year for 20 years; payment received at the end of the year.

2) Accept an upfront payment of $X today.

What value of $X will cause John to be indifferent between option 1 and option 2 if the interest rate is 10%?

What value of $X will cause John to be indifferent between option 1 and option 2 if the interest rate is 10%?