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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 $2 million now.8 r+ ?; i E0 s4 K4 O
a) Calculate the amount of money that the Alberta Lottery Corporation must keep in the bank to be able to pay the weekly prize.
4 r" j* m: I* k7 z- z' w, ^Assume the following:
% o/ u5 k# W$ K; h) o" y- r = 0.06 (6 percent)
! r6 F, f5 y$ ~: @2 `- Interest is paid annually to the Lottery Corporation |
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