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Question by qaperson6859: What rate of return i built into the annuity?
You just won the state lottery. the state gives yo the choice of million today or a 20 year annuity of ,000 starting one yer from today (assume both are after taxes). what rate of return is built into he annuity
equation usd?
equation used?

Best answer:

Answer by Serge M
The rate is 4.21 percent compounded annually. You are better off taking the million because that amount can be invested better than 4.2 percent. A solid conservative stock portfolio can easily return 8-10 percent per year.

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