Bill Swill Decides to Try His Luck at Powerball Where

Multiple Choice

Bill Swill decides to try his luck at Powerball where the projected winnings are $12,000,000. If he wins, he can choose the annuity option (to be paid over 20 years) or a lump sum settlement that he can invest at 8% interest. How much must the lump sum option be to make the lump sum option equal to the annuity option (rounded) ?

A) $2,574,578
B) $1,743,620
C) $1,130,668
D) $1,200,000