Lottery A pays $1,000 today and Lottery B pays $1,750 at the end of five years from now. If the discount rate is 5%, I should choose Lottery A, because it is available to me now. Lottery A because its future value is $1.276. Lottery B, because its present value is $1,371 which is more than that of Lottery A. Lottery B, because it pays $1.750 which is more than $1.000 from Lottery A. Either option gives the same value over time