Question
For questions ## 2, 3, 4, 5, and 6, please use the present and future value tables, for $1 at 3%, as follows: N FV
For questions ## 2, 3, 4, 5, and 6, please use the present and future value tables, for $1 at 3%, as follows:
N | FV $1 | PV $1 | FVA $1 | PVA $1 | FVAD $1 | PVAD $1 |
1 | 1.03000 | 0.97087 | 1.0000 | 0.97087 | 1.0300 | 1.00000 |
2 | 1.06090 | 0.94260 | 2.0300 | 1.91347 | 2.0909 | 1.97087 |
3 | 1.09273 | 0.91514 | 3.0909 | 2.82861 | 3.1836 | 2.91347 |
4 | 1.12551 | 0.88849 | 4.1836 | 3.71710 | 4.3091 | 3.82861 |
5 | 1.15927 | 0.86261 | 5.3091 | 4.57971 | 5.4684 | 4.71710 |
6 | 1.19405 | 0.83748 | 6.4684 | 5.41719 | 6.6625 | 5.57971 |
7 | 1.22987 | 0.81309 | 7.6625 | 6.23028 | 7.8923 | 6.41719 |
8 | 1.26677 | 0.78941 | 8.8923 | 7.01969 | 9.1591 | 7.23028 |
9 | 1.30477 | 0.76642 | 10.1591 | 7.78611 | 10.4639 | 8.01969 |
10 | 1.34392 | 0.74409 | 11.4639 | 8.53020 | 11.8078 | 8.78611 |
11 | 1.38423 | 0.72242 | 12.8078 | 9.25262 | 13.1920 | 9.53020 |
12 | 1.42576 | 0.70138 | 14.1920 | 9.95400 | 14.6178 | 10.25262 |
13 | 1.46853 | 0.68095 | 15.6178 | 10.63496 | 16.0863 | 10.95400 |
14 | 1.51259 | 0.66112 | 17.0863 | 11.29607 | 17.5989 | 11.63496 |
15 | 1.55797 | 0.64186 | 18.5989 | 11.93794 | 19.1569 | 12.29607 |
16 | 1.60471 | 0.62317 | 20.1569 | 12.56110 | 20.7616 | 12.93794 |
While visiting Barney Smith's Toilet Seat Art Museum, in Alamo Heights, Texas, Kaleb just happened to buy the winning lottery ticket. However, in order to redeem his ticket, the lottery commission requires that he make a choice: either (a) receive eight $100,000 semiannual payments, starting today, or (b) receive a single-amount payment, today, based on a 6% annual interest rate. What is the single-amount payment he can receive today?
(a) $853,020;
(b) $801,969;
(c) $744,090;
(d) $1,293,794; or
(e) none of the above.
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