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 $2 million now.' c* ]3 X/ j9 U& C9 l
a) Calculate the amount of money that the Alberta Lottery Corporation must keep in the bank to be able to pay the weekly prize. 4 G3 Y$ t' d0 w4 P* sAssume the following: _ C2 f5 X9 ~* y" g* M' `
- r = 0.06 (6 percent)0 I M3 O) J! s2 A* B6 e' S
- Interest is paid annually to the Lottery Corporation