ACC 307 7-2 Homework 2 - Answer each of the following...

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Answer each of the following independent questions. 1. Alex Meir recently won a lottery and has the option of receiving one of the following three prizes: (1) $86,000 cash immediately, (2) $32,000 cash immediately and a six-period annuity of $9,200 beginning one year from today, or (3) a six-period annuity of $17,400 beginning one year from today. a. Assuming an interest rate of 6%, determine the Present value for the above options. (Use PVA of $1 ) (Round "PV Factors" to 5 decimal places and final answers to the nearest dollar amount.)
b. Which option should Alex choose?

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