Suppose you win a lottery. You have two choices for receiving the money. Choice 1: $50 000 at the end of each year for 20 years Choice 2: $500,000 now If current interest rates are approximately 8% p. a. compounded yearly, which is the better choice. Justify your answer with a clear solution and explanation.

The first option of an annuity is better because the amount is worth   $2,288,098 in today's cash

Explanation:

The better choice would be the option with the higher present value discounted at the required rate of return. The required rate of return is 8%.

To determine the better choice, we would compare the present value of choice 1 to the $500, 000 receivable today under choice 2

The present value of $50 000 at the end of each year for 20 years is

PV = A × ((1+r)^n - 1)/r

r- 8%, n - 20, A= 50,000, PV - Present value

PV = 50,000 × (  ( 1.08)^(20) - 1) /0.08

     =  50,000 ×  45.7619643

     =  $2,288,098

The first option of an annuity is better because the amount is worth   $2,288,098 in today's cash which is higher than $500,000 offered by the second option.

The first option is greater than the second by $1,788,098.21  i.e

$2,288,098 - $500,000

the first successful, urban blues recording, selling more than 75,000 copies, was made in year 1920.

mamie smith recorded the first commercially successful example of the urban blues,   with the recording of “crazy blues”."crazy blues" was recorded on august 10, 1920, in new york city. within a month of the release of “crazy blues” it had sold 75,000 copies.

answer; intellectual property protection;