How large must the lump sum be to leave him as well off


Your friend was injured in an accident, and the insurance company has offered him the choice of $25,000 per year for 15 years, with the first payment being made today, or a lump sum. If a fair return is 7.5%, how large must the lump sum be to leave him as well off financially as with the annuity?

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Finance Basics: How large must the lump sum be to leave him as well off
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