Problem:
You win a big prize in the Super Lottery. You will receive $20186today, and then $20186 for each of the succeeding 9 years. There are private parties who will buy your winning ticket for a lump sum payable today. In fact, one such person offers to pay you one half of your total winnings (10 times $20186).
Required:
Question: What rate of return is the buyer receiving on the investment?
Note: Provide support for your rationale.