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16 May, 14:13

You just won $70,000 on a scratch-off lottery ticket. You plan to save the money in a retirement account expected to return 8% per year. If you intend to retire in 45 years, how much are these lottery winnings expected to be worth when you retire? a. $942,089 b. $2,234,431 c. $4,788,067 d. $1,260,147 e. $2,615,364

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  1. 16 May, 14:28
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    The correct answer is B.

    Explanation:

    Giving the following information:

    You just won $70,000 on a scratch-off lottery ticket. You plan to save the money in a retirement account expected to return 8% per year.

    The number of years is 45.

    We need to use the following formula for future value:

    FV = PV * (1+i) ^n

    FV = 70,000 * (1.08) ^45 = $2,234,431.46
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