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A prize raffle will be paid out as 5,000 dollars today (option A) or as 7,500 dollars 5 years from now. Given the appropriate discount rate of 7.

                              

A prize raffle will be paid out as 5,000 dollars today (option A)                  

or as 7,500 dollars 5 years from now. Given the appropriate discount rate of 7.15 percent (option B)


Which is better and why?   

Top Answer

Answer  7,500 dollars 5 years from now... View the full answer

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Other Answers

Option B is better as... View the full answer

2 comments
  • Thanks for teaching me.
    • bluplanet
    • May 13, 2018 at 10:02am
  • You are most welcome
    • payaljain3
    • May 13, 2018 at 10:14am

Option B is better because present... View the full answer

2 comments
  • Thanks for learning me.
    • bluplanet
    • May 13, 2018 at 10:02am
  • Most welcome..
    • newlyexpert
    • May 13, 2018 at 10:04am

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