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You just won a big jackpot in Twin River Casino and have been offered two options: Option I: Receive $100,000 at the end of each
You just won a big jackpot in Twin River Casino and have been offered two options: Option I: Receive $100,000 at the end of each of next 30 years Option II. Receive a lump sum today (t=0) How much should the lump sum be so that you are indifferent (not care either way) between the two options? The interest rate is 5% compounded semi-annually (Nominal Rate). Please round your answer to the nearest dollar. $1,979,277 $1,537,245 $1,526,353 $2,958,555
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