Congratulations, you have won the California State Lottery. Lottery officials are giving you a choice of payment options. You will need to choose from one of the following streams. Assume at 5% interest rate for all scenarios. Option 1

Immediate payment of $1,000,000

Option 2

10 annual installments of $120,000

Option 3

$2,650,000 paid at the end of 20 years

Option 4

20 annual installments of $80,000

Option 5

5 annual installments of $100,000 plus a lump sum of $750,000 at the end of 5 years

Consider these options without referencing the calculation methods presented in the Chapter 12 Appendix.

Which options will result in receiving the most cash? Which option do you think you should choose and why? Which will be the least favorable option and why?

Suppose that the free states of eldricia, a small nation, has consumption, investment, government purchases, imports, and exports as follows. consumption $140 investment $50 government purchases $45 imports $30 exports $15 calculate the free states of eldricia's gdp

Suppose that a monopolistically competitive restaurant is currently serving 260 meals per day (the output where mr

Profits from using currency options and futures.on july 2, the two-month futures rate of the mexican peso contained a 2 percent discount (unannualized). there was a call option on pesos with an exercise price that was equal to the spot rate. there was also a put option on pesos with an exercise price equal to the spot rate. the premium on each of these options was 3 percent of the spot rate at that time. on september 2, the option expired. go to the oanda.com website (or any site that has foreign exchange rate quotations) and determine the direct quote of the mexican peso. you exercised the option on this date if it was feasible to do so. a. what was your net profit per unit if you had purchased the call option? b. what was your net profit per unit if you had purchased the put option? c. what was your net profit per unit if you had purchased a futures contract on july 2 that had a settlement date of september 2? d. what was your net profit per unit if you sold a futures contract on july 2 that had a settlement date of september 2