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1) Suppose you have taken on a job at the lottery commission and have been given the task of putting out the advertisements with the

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1) 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: PV = redt 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. i) If the earnings rate for the commission gets weaker, does that change either, both, or neither of the one- time payment or the yearly payment? If there is a change, is it now bigger or smaller? ii) If the number of years in the yearly payments is extended, say to 30 years instead of 25, would the yearly payments get bigger or smaller? 1) 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: PV = redt 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. i) If the earnings rate for the commission gets weaker, does that change either, both, or neither of the one- time payment or the yearly payment? If there is a change, is it now bigger or smaller? ii) If the number of years in the yearly payments is extended, say to 30 years instead of 25, would the yearly payments get bigger or smaller

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