Haluk has just retired. He may choose either to take a lump sum retirement benefit of
$750,000 today or elect to receive an annual annuity payment of $60,000 a year for 25
years, with the first payment to be made at the end of the year. If Haluk's opportunity
cost of capital is 6%, which option should he choose?

Question

Quizplus · Accepted Answer

The Answer of Haluk has just retired. He may choose either to take a lump sum retirement benefit of
$750,000 today or elect to receive an annual annuity payment of $60,000 a year for 25
years, with the first payment to be made at the end of the year. If Haluk's opportunity
cost of capital is 6%, which option should he choose?

Haluk Has Just Retired