What is in your opinion the relationship between risk and return?
Do you buy lottery tickets?
Why do people buy lottery tickets?
Why do you buy them?
How many of you would buy a $1 lottery ticket if the jackpot were $1 million?
How many of you would buy a $1 lottery ticket if the jackpot were $10 million?
How many of you would buy a $1 lottery ticket if the jackpot were $50 million?
How many of you would buy a $1 lottery ticket if the jackpot were $1.04?
Why wouldn't you buy the lottery ticket that pays $1.04? That's a 4 percent return on your money if you win.
Some folks keep money in savings accounts that earn less than 4 percent.
If you were a large (over/under $ 1 million) lottery or sweepstakes winner, how would you determine whether you would want the sweepstakes prize today or over ten years if you could earn only 6 percent interest on the investments?