Suppose you win a small lottery and have the choice of two ways
to be paid: You can accept the money in a lump sum or in a series
of payments over time. If you pick the lump sum, you get $2,800
today. If you pick payments over time, you get three payments:
$1,000 today, $1,000 1 year from today, and $1,000 2 years from
today.
At an interest rate of 6% per year, the winner would be better
off...