The winner of the Mega Millions lottery game can choose to accept a one-time payout of $163.68 million or receive $11 million per year for 20 years. Using the tables shown and assuming the interest rate is 3 percent, the state:Annuity Table(value now of $1 Per year To be received for x-years) Present Value Table(Value now to $1 to be received x-years un the future) Year3%4%6%Year3%4%6%108.538.117.36100.740.680.531511.9411.129.71150.640.560.422014.8813.5911.47200.550.460.313019.6017.2913.76300.410.310.17
A. prefers to pay over time because it will save money.
B. probably does not care-it has set the lump sum equal to the present value of the payments over time.
C. prefers to pay the lump sum because it saves about $100 million.
D. probably does not know which is better because the two cannot be compared.
Answer: B
Economics
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