You win a lottery prize that has a total value (after taxes) of $35,850,000. 30 yearly payments of

$1,195,000 would be made if you took the winnings over the 30 year payout with the first

payment being made immediately and the remaining equal payments being made yearly at the

beginning of each year. The lottery would buy an annuity which has an annual interest rate of

5.2%. You elect the alternative and take the cash value of this annuity now. You calculate that

you can make more money by investing the winnings at a higher rate than 5.2%. What is the

cash value of this annuity?

8.) You graduate from college and start work. You set up an investment plan whereby you

contribute $125 from each of your monthly paychecks and get 5.4% interest compounded

monthly. You have your first payment payroll deducted and deposited into the IRA (individual

retirement account) at the end of your first month's work. If you intend to work for

45 years, what will be the value of this investment when you retire?