Michael has just won some money on a game show! He has the option to take a lump sum payment of $700,000 now or get paid an annu
ity of $3,600 at the beginning of each month for the next 20 years. Assuming the growth rate of the economy is 3.4% compounding annually over the next 20 years, which
is the better deal for Michael and by how much? (4 points)
