Rajeev Gandhi died, leaving to his wife an insurance policy contract that provides beneficiary (wife) can choose any one of the following four options.

a. $55,000 immediate cash.

b. $4,000 every 3 months payable at the end of each quarter for 5 years.

c. $18,000 immediate cash and $1,800 every 3 months for 10 years, payable at the beginning of each

3-month period.

d. $4,000 every 3 months for 3 years and $1,500 each quarter for the following 25 quarters, all payments payable at the end of each quarter.

Instructions

If annual interest rate 10% per, compounded quarterly, which option would you recommend that

the wife exercise?