What is the equivalent lump-sum payment


Problem: Shelley wants to cash in her winning lottery ticket. She can either receive 10, $100,000 semiannual payments starting today, or she can receive a lump-sum payment now based on a 6% annual interest rate. What is the equivalent lump-sum payment?

a. $853,020

b. $801,969

c. $744,090

d. $878,611

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Finance Basics: What is the equivalent lump-sum payment
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