Suppose you win a small lottery and you are given the following choice: You can (1) receive an immediate payment of $10,000 or (2) three annual payments, each in the amount of $3,600, with the first payment coming one year from now, the second two years from now, and the third three years from now. You would choose to take the three annual payments if the interest rate is:_______.
a. 2 percent, but not if the interest rate is 3 percent.
b. 3 percent, but not if the interest rate is 4 percent.
c. 4 percent, but not if the interest rate is 5 percent.
d. 5 percent, but not if the interest rate is 6 percent.

Considering the situation described above, I would choose to take the three annual payments if the interest rate is "3 percent, but not if the interest rate is 4 percent."

This is because by calculating whether to take the immediate payment of $10,000 or three annual payments, each in the amount of $3,600, we have the following:

$10,000 or

$3600 - 1yr = 3600 / 1.03

$3600 - 2yr = 3600 / 1.03^2

$3600 -3yr = 3600 / 1.03^3

Thus, I would choose three annual payments if the interest rate is 3 percent, but not if the interest rate is 4 percent.

Therefore, in this case, it is concluded that the correct answer is option B. "3 percent, but not if the interest rate is 4 percent."

Learn more here: https://brainly.com/question/24018659