Business, 01.11.2019 05:31 td0715

Suppose you win a small lottery and have the choice of two ways to be paid: you can accept the money in a lump sum or in a series of payments over time. if you pick the lump sum, you get $2,800 today. if you pick payments over time, you get three payments: $1,000 today, $1,000 1 year from today, and $1,000 2 years from today.
at an interest rate of 6% per year, the winner would be better off accepting the (lump sum or payments over time), since it has the greater present value.
at an interest rate of 9% per year, the winner would be better off accepting 2) (lump sum or payments over time) , since it has the greater present value.

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