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Please help asap. Problem 2 You have just won the lottery and you can choose between the following payout options. The annual interest rate (EAR)
Please help asap.
Problem 2 You have just won the lottery and you can choose between the following payout options. The annual interest rate (EAR) is 5%. 1. $70,000 right now and $20,000 every two years starting 3 years from now and ending 17 years from now (i.e., payments at t=0,t=3,5,,15,17 ). 2. $15,000 a year for 20 years with the first payment one year from today (i.e., payments at t=1,2,3,,19,20 ). 3. 15 annual payments of $15,000 and a 16th payment of $100,000. The first payment is made right now (i.e., payments at t=0,1,2,3,,15 ). How much more (in today's \$) is the best option worth relative to the worst optionStep by Step Solution
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