You have won $1,250,000 in a lottery. Your winnings will be paid to you in equal annual yearend installments of $250,000 over 5 years. You estimate that you can earn 4% on your investments. The present value of$1 for 5 periods at 4% is 0.822. The present value of an ordinary annuity of $1 for 5 periods at 4% is 4.452. The present value of your $1,250,000 winnings would be closest to:

A.

$1,027,500

B.

$205,500

C.

$1,250,000

D.

$1,113,000