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Congratulations! You have won the Lottery For Life and are the proud winner of $1,000 per week for the rest of your life!! You have the option of accepting a cheque for $1000 per week until you die, or reach the age of 75, whichever comes sooner. Alternatively, you may accept a cash payout of $2 million now.* f5 c! i+ h/ M( ]1 n: B
a) Calculate the amount of money that the Alberta Lottery Corporation must keep in the bank to be able to pay the weekly prize.6 v" M9 Z0 a; K' w) [1 [/ |
Assume the following:
/ ~8 W# M3 _7 r. \- i, L! v) Q- r = 0.06 (6 percent)$ U4 d7 V# v2 v+ a0 o! g3 |- Q/ | r
- Interest is paid annually to the Lottery Corporation |
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