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You just won a $ 2 . 5 million lottery. You can choose between receiving: $ 1 million today or $ 1 0 0 ,
You just won a $ million lottery. You can choose between receiving: $ million today or $ per year for years. Assuming you think you, can earn percent per year on your investments, compounded annually, which of these alternatives is a better deal?
You just won a $ million lottery. You can choose between receiving: $ million today or $ per year for years. Assuming you think you, can earn percent per year on your investments, compounded annually, which of these alternatives is a better deal?
The $ million lump sum is a better deal because it has a higher present value than the annuity.
The $ annuity is a better deal because it has a higher present value than $ million.
The $ annuity is a better deal since you will end up receiving a total of $ million.
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