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How much would payment option

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Question - You are a lucky winner of the $30 million state lottery. You can take your prize money either as (a) 30 payments of $1m per year (starting today); OR (b) 15 million paid today.

If the APR is 8% with annual compounding, which option would you choose?

How much would payment option (a) be worth at t=0 / today, in millions?

Reference no: EM132822863

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