When Someone Wins a Lottery Jackpot They Are Often Given

question 163

Multiple Choice

When someone wins a lottery jackpot they are often given the choice between receiving their winnings over some period of time or receiving less money but receiving it all at once. It makes the most economic sense to

• A)receive the money over time because the amount received will be greater.
• B)receive the reduced amount of money in one lump sum because it is always better to have money sooner rather than later.
• C)receive whichever option yields the greatest present value.
• D)none of the above

---

Definitions:

Limited Partnerships

A form of partnership consisting of one or more general partners, who manage the business and assume legal debts and obligations, and one or more limited partners, who are liable only to the extent of their investments.

Corporate Income Taxes

Taxes imposed on the net income or profit of corporations, calculated after deducting expenses like cost of goods sold and wages.

Expected Profit Rate

The forecasted return on an investment or business venture, calculated as the potential profit over time divided by the initial cost.

Interest Rate

The slice of a loan subjected to interest rates for the borrower, commonly conveyed as an annual percentage of the loan's remaining sum.