Lucky Ed, 70, just won a Power Ball Lotto worth $120 million. He has two options collect his winnings:
Option #1: Annuity Option: One Pmt per year. In all 20 pmts
Option # 2: Cash Option: Lotto Commission would use a Discount Rate of 10% to calculate it.
Assume Ed to be 40% Marginal Tax bracket. On Your advice, Ed has decided to take the Cash Option.
Based on your calculation Joe would, under Cash Option, would receive a Check of:
Note: The answers are rounded to Zero Decimal points.