(that is, $2,940,000 over 30 years) or as a single amount of $1,184,000 paid immediately. a. If you expect to earn 11% annually on your investments over the next 30 years, ignoring taxes and other considerations, which alternative should you take? Why? b. Would your decision in part a change if you could earn 13% rather than 11% on your investments over the next 30 years? Why? c. At approximately what interest rate would you be indifferent between the two options? necessarily a better choice due to the different timing of cash flows. A way to make a meaningful comparison of the two alternatives is to compare their present values. If you take the prize as an annuity, the present value of the 30-year ordinary annuity is $ (Round to the nearest cent.) If you take the prize as a single amount, the present value of the lump sum is $ (Round to the nearest dollar.) Which alternative should be chosen? (Select the best answer below.) Lump sum, because the present value is greater. Annual payments, because the present value is greater. b. If you earned 13% rather than 11% on your investments, the present value of the 30 -year ordinary annuity is $ (Round to the nearest cent.) Which alternative should be chosen? (Select the best answer below.) Lump sum, because the present value is greater. Annual payments, because the present value is greater. c. On a strictly economic basis, the rate at which you would be indifferent between the two plans is 6. (Round to two decimal places.)