Suppose you have taken on a job at the lottery commission and have been given the task of putting out the advertisements with the latest Grand Prize Jackpot award. Ticket sales have brought the account for this jackpot up to $57 million, which would be the one-time payout if the winner chooses this. However, it is much better to advertise the much larger amount resulting from 25 yearly payments. Assuming the lottery commission earns 4.2% compounded continuously, use the Present Value formula to:

a) Find the yearly payments, in $Millions, rounded to the nearest 0.01.

b) Find the amount you will place in the advertisements as the Grand Prize Jackpot, in $Millions, rounded to the nearest 0.1.

Answer rating: 100% (QA)

Answer Solution a One Time Jackpot Amount 57 Million N... View the full answer