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Question: Future Value of an Annuity You are given a choice on a $75,000 inheritance between receiving: 1. the full payment today or, 2.

Question: Future Value of an Annuity You are given a choice on a $75,000 inheritance between receiving: 1. the full payment today or, 2. a $7,000 annuity for the next 15 years and a lump sum of $5,000 at the end of the 15th year. If you can earn 5%, which option is the most attractive? Show your calculations. Solution:

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