Sandra has just won a lottery. She will receive a payment of $9,200 at the end of each year for 9 years. As an alternative, she can choose an immediate payment of $40,000.
Which alternative should she pick if the interest rate is 4 percent?
Sandra should pick | (Choose your answer here) Immediate payment or Payment at the end of each year |
What would the interest rate have to be for Sandra to be
indifferent about the two alternatives? (Round answer
to 4 decimal places. Do not round your intermediate
calculations.)
Interest rate | Type your answer here | % |
Get Answers For Free
Most questions answered within 1 hours.