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Lawrence invests his money in a special fund for n years. At the end of n years, he has three payout options from which to
Lawrence invests his money in a special fund for n years. At the end of n years, he has three payout options from which to choose: 1. One-time $11,874.09 cash payment. 2. A perpetuity-immediate with $465.83 level semiannual payments. 3. A 2n-year annuity-immediate with $593.07 level semiannual payments. The annual effective interest rate, i, earned by the fund is constant. Calculate Lawrence's initial fund value A2,500 B4,00o C5,50o D7,000 E 8,500
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