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Mary Alice just won the lottery and is trying to decide between the options of receiving the annual cash flow payment option of $250,000 per
Mary Alice just won the lottery and is trying to decide between the options of receiving the annual cash flow payment option of $250,000 per year for 25 years beginning today, or receiving one lump-sum amount today. Mary Alice can earn 6% investing this money. At what lump-sum payment amount would she be indifferent between the two alternatives? (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1)
A. 3,637,590 B. 3,387,590 C. 6,250,000 D. 3,195,840
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