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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.
! m/ U0 ~3 d7 p3 Q1 F! Ba) Calculate the amount of money that the Alberta Lottery Corporation must keep in the bank to be able to pay the weekly prize.
8 v6 K! B9 M) L0 nAssume the following:5 I+ W( J, u% G3 X! x
- r = 0.06 (6 percent)/ m% _2 |. v- B
- Interest is paid annually to the Lottery Corporation |
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