A lottery offers a prize of $750 every week for 5 years.The first payment will be made one week from now.If money can be invested at 4.4% per year compounded weekly, what cash paymentreceived immediately is equivalent to the lottery prize?a) $148.05b) $218 010.73c) $711 389.65d) $174 973.98

Given data, annuity Payments A= $750 i = interest rate = 4.4% m = compounding frequency = weekly =…

Answered: A lottery offers a prize of $750 every…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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A lottery offers a prize of $750 every week for 5 years. The first payment will be made one week from now. If money can be invested at 4.4% per year compounded weekly, what cash payment received immediately is equivalent to the lottery prize? a) $148.05 b) $218 010.73/ c) $711 389.65 d) $174 973.98