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Assume you have just won the Mega Millions lottery valued at $900 million.

1.     Assume you have just won the Mega Millions lottery valued at $900 million. You have two disbursement options, you can either take a lump sum of $450 million or you can take annual payments of $40 million for the next 25 years.

a.      If you could earn 8 percent, which option would you choose? Why?

b.     Would you decision change if you could only earn 6.50 percent instead? Why or why not? 

Top Answer

a.      If you could earn 8 percent, you would choose the lump sum... View the full answer

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