Assume beginning of period payments

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Reference no: EM131452257

You have the choice of receiving $20,000/year for the next 10 years or a one-time payment (lump sum) of $160,000. Your opportunity cost for your money is 8%. Which of these options provides you with the greatest value today? Assume beginning of period payments.

A. Take the $20,000/year.

B. You should take the $160,000 today.

C. These 2 options provide the same value to you today.

D. Not enough information to calculate an answer.

Reference no: EM131452257

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