The annual discount rate is 9%. Compute the present value of the second option. (Round to nearest whole dollar.)

Edward Hughes has just won the state lottery and has the following three payout options for after-tax prize money:



1. $166,000 per year at the end of each of the next six years

2. $306,000 (lump sum) now

3. $518,000 (lump sum) six years from now







A) $684,000

B) $103,600

C) $414,400

D) $306,000


D) $306,000

Business

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