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Cassie just won the lottery, and she must choose between three award options. she can elect to receive a lump sum today of $61 million, to receive 10 end of year payments of $9.5 million, or to receive 30 end of year payments of 5.5 million.

(a) if she thinks she can earn 7% annually, which would she choose?

(b) if she expects to earn 8% annually, which is the best choice?

(d) explain how interest rates influence the optimal choice?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9450355

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