Assume you win the lottery and have a choice to receive your winnings in one of two ways. Option 1 is payments of $50,000 per year for each of the next five years. Option 2 is a single payment of $200,000 immediately. Which of the following statements is most correct?
a. Option 1 is preferable to Option 2.
b. Option 2 is preferable to Option 1.
c. Option 1 and Option 2 are equivalent.
d. There is not enough information to answer this question.