Kelsey just won the lottery, and she must choose among three award options. She can elect $(1)$ to

receive a lump sum today of $$62$ million, $(2)$ to receive end$-$of$-$month payments of $$0\mathrm{.}8$ million for $10$

years or $(3)$ to receive end$-$of month payments of $$0\mathrm{.}47$ million for $30$ years. If she can earn $9\%$ annually

$($i$.$e$.,$ the discount rate is $9\%$ per year$),$ which is the best choice based on the PV of the three award

options?

$($Hints: watch Video $2$ of Chapter $5$ from $11$:$53$ to $14$:$30$ on D$2$L$)$

a$)$ PV of $1^{st}$ award option:

b$)$ PV of $2^{nd}$ award option:

$N=$

I$/$YR$=$

PMT$=$

$FV=$

$PV=$

c$)$ PV of $3^{rd}$ award option

$N=$

I$/$YR$=$ PMT$=$

$FV=$

$PV=$

d$)$ Which is the best choice for Kelsey?

Suppose Sam deposits $$100$ in an account at the end of this year, $$300$ at the end of the next two year,

$$50$ at the end of the following year. If the annual interest rate is $4\%,$ how much will be in the account

immediately after the fourth deposit is made? Do you think it is enough to purchase a $$785$ airline ticket

to Paris?