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Professor Jane Lamoure just won a big Jackpot at the Montreal casino. She has been offered two options: Option 1: Receive $95,000 at the beginning

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Professor Jane Lamoure just won a big Jackpot at the Montreal casino. She has been offered two options: Option 1: Receive $95,000 at the beginning of each year of the next 25 years Option 2: Receive a lump sum at the beginning of next year (t=1) How much should the lump sum (Option 2) be, so that jane would be indifferent between the two Options 1 and 2 ? The interest rate is 4% compounded seml-annually. Round your answer to the nearest e. $1,537,548 f. $1,599,665 g. $1,59,8435 h. $1,265,873 $1,584,000

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