Explain how interest rates influence

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Reference no: EM131448340

Crissie just won the lottery, and she must choose among three award options. She can elect to receive a lump sum today of $61 million, to receive 10 end-of-year payments of $9 5 million, or to receive 30 end-of-year payments of $5 5 million.

a. If she thinks she can earn 7% annually, which should she choose?

b. If she expects to earn 8% annually, which is the best choice?

c. If she expects to earn 9% annually, which option would you recommend?

d. Explain how interest rates influence her choice.

Reference no: EM131448340

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