Inheritance investment options which is one would be better?

denali9696 · #1 Apr 24, 2008, 05:52 PM

Hello,

Can someone please assist me in the following question.

Your uncle has given you three alternatives for your inheritance. You can have $10,000 now; $2,000 per year for the next eight years; or $24,000 at the end of eight years. Which inheritance alternative would be best and why? The discount rate is 6% (Explain your answer fully)

My choice would be the 24K at the end of 8 years because I would then receive $38,252 vs. the 10K now or the 2k per year which would only be 16k at the end of the eight years.

Please let me know if I am on the right track.



At Ask Me Help Desk you can ask questions in any topic and have them answered for free by our experts. To ask questions or participate in answering them you must register for a free account. By registering you will be able to: Get free answers from experts in any of our 300+ topics. Accept money for answers that you provide. Communicate privately with other members (PM). See fewer ads. Sign Up!