You Have Just Won a Contest! You Can Either Receive

question 119

Multiple Choice

You have just won a contest! You can either receive $10,000 a year for 15 years or $100,000 as a lump sum payment today. What is the interest rate on the annuity option?

• A) 5.56 percent
• B) 5.68 percent
• C) 6.20 percent
• D) 6.39 percent
• E) 6.50 percent

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Definitions:

Social Ethics

A branch of philosophy that deals with the moral principles governing social behavior and societal systems.

Level I

The initial or basic stage of a process, classification, or hierarchy.

Stage 2

A phase in a process or project that typically involves the development and implementation of plans following initial preparation or groundwork.

Individual Needs

The specific requirements or desires unique to each person, essential for their well-being and satisfaction.