You are offered a $3,360,000 retirement package to be given in $120,000 payments at the end of each of the next 28 years. You are also given the option of accepting a $1,190,000 lump sum payment now. Interest rates are at 8.3% over the next 28 years. Which is a better option? A- the offered annual payments of $120,000 b- the lump sum of $1,190,000 c- they are the same d cannot be determined
You are offered a $3,360,000 retirement package to be given in $120,000 payments at the end of each of the next 28 years. You are also given the option of accepting a $1,190,000 lump sum payment now. Interest rates are at 8.3% over the next 28 years. Which is a better option? A- the offered annual payments of $120,000 b- the lump sum of $1,190,000 c- they are the same d cannot be determined
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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You are offered a $3,360,000 retirement package to be given in $120,000 payments at the end of each of the next 28 years. You are also given the option of accepting a $1,190,000 lump sum payment now. Interest rates are at 8.3% over the next 28 years. Which is a better option?
A- the offered annual payments of $120,000
b- the lump sum of $1,190,000
c- they are the same
d cannot be determined
Transcribed Image Text:you are ofmered a s2.300,000 retirement package to be given in s120,000 peyments at the end of each of the next 28 yoars. You are alao gven the option of accesting a s1.190,000 ume sum
payment now. Teterest rates ere at 3% over the next 2 years. Which is a better option?
the uffered annual payments uf s120,000
the lump sum of $1,190,000
they are the same
cancot be detemined
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