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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 $2 million now.
) ~. t( O0 Z2 y3 L1 A# ^a) Calculate the amount of money that the Alberta Lottery Corporation must keep in the bank to be able to pay the weekly prize., ~; E% r" Q+ `: ]2 R4 Z; |
Assume the following:4 L# O+ h5 w2 z' [
- r = 0.06 (6 percent)
5 n& D& b1 |5 k4 L9 v$ k- Interest is paid annually to the Lottery Corporation |
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