1. You recently won a lottery and have the option of receiving one of the following three prizes: (1) $76,000 cash immediately, (2) $27,000 cash immediately and a six-year annual annuity of $8,500 beginning one year from today, or (3) a six-year annual annuity of $15,800 beginning one year from today. Assuming an interest rate of 7% compounded annually, determine the present value for the above options. Which option should you choose?
2. A company wants to accumulate a sum of money to repay certain debts due in the future. The company will make annual deposits of $145,000 into a special bank account at the end of each of 10 years. Assuming the bank account pays 8% interest compounded annually, what will be the fund balance after the last payment is made in ten years?

Assuming a 12% annual interest rate, determine the present value of a five-period annual annuity of $2,600 under each of the following situations: Note: Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1 ) 1. The payments are received at the end of each of the five years and interest is compounded annually. 2. The payments are received at the beginning of each of the five years and interest is compounded annually. 3. The payments are received at the end of each of the five years and interest is compounded quarterly. The payments are received at the end of each of the five years and interest is compounded annually. Note: Round your final answers to nearest whole dollar amount. Complete this question by entering your answers in the tabs below. The payments are received at the beginning of each of the five years and interest is compounded annually. Note: Round your final answers to nearest whole dollar amount. Complete this question by entering your answers in the tabs below. The payments are received at the end of each of the five years and interest is c Note: Round your final answers to nearest whole dollar amount. Assuming a 12% annual interest rate, determine the present value of a five-period annual annuity of $2,600 under each of the following situations: Note: Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1 ) 1. The payments are received at the end of each of the five years and interest is compounded annually. 2. The payments are received at the beginning of each of the five years and interest is compounded annually. 3. The payments are received at the end of each of the five years and interest is compounded quarterly