What rate of return is built into the annuity

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Question 1: Suppose you just won the state lottery, and you have a choice between receiving $4,500,000 today or a 20-year annuity of $250,000, with the first payment coming one year from today. What rate of return is built into the annuity? Disregard taxes.

Select the correct answer.

Option a. 0.33%

Option b. 1.03%

Option c. -0.37%

Option d. 1.73%

Option e. 2.43%

Reference no: EM132490974

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