Suppose You Have a Choice Between Receiving a Lump-Sum Payment

question 166

Multiple Choice

Suppose you have a choice between receiving a lump-sum payment of $10,000 today or four annual payments of $2,750 (with the first payment today) .Of the following,which is the highest annual interest rate at which you would prefer the four annual payments over the lump-sum payment?

• A)2%
• B)​5%
• C)​7%
• D)​10%

---

Definitions:

Multinational Corporations

Large business organizations that operate and provide goods or services in multiple countries beyond their country of origin.

Congressional Oversight

The review and supervision of federal agencies, programs, and policy implementations by the United States Congress.

Free Exercise Clause

A provision in the First Amendment of the U.S. Constitution that guarantees the freedom to practice one's own religion without government interference.

Amendment

A formal change or addition proposed or made to a law, contract, constitution, or other legal document.