Question
In: Accounting
The gaming commission is introducing a new lottery game called Infinite Progresso. The winner of the...
The gaming commission is introducing a new lottery game called Infinite Progresso. The winner of the Infinite Progresso jackpot will receive $1,100 at the end of January, $2,400 at the end of February, $3,700 at the end of March, and so on up to $15,400 at the end of December. At the beginning of the next year, the sequence repeats starting at $1,100 in January and ending at $15,400 in December. This annual sequence of payments repeats indefinitely. If the gaming commission expects to sell a minimum of 850,000 tickets, what is the minimum price they can charge for the tickets to break even, assuming the commission earns 6.00 %/year/month on its investments and there is exactly one winning ticket?
Solutions
ekkarill92 answered 1 year agoRelated Solutions
A state lottery commission pays the winner of the Million Dollar lottery 20 installments of $50,000/year....
A state lottery commission pays the winner of the Million Dollar
lottery 20 installments of $50,000/year. The commission makes the
first payment of $50,000 immediately and the other n = 19
payments at the end of each of the next 19 years. Determine how
much money the commission should have in the bank initially to
guarantee the payments, assuming that the balance on deposit with
the bank earns interest at the rate of 4%/year compounded yearly.
Hint: Find the present...
A state lottery commission pays the winner of the Million Dollar lottery 20 installments of $50,000/year....
A state lottery commission pays the winner of the Million Dollar
lottery 20 installments of $50,000/year. The commission makes the
first payment of $50,000 immediately and the other n = 19
payments at the end of each of the next 19 years. Determine how
much money the commission should have in the bank initially to
guarantee the payments, assuming that the balance on deposit with
the bank earns interest at the rate of 5%/year compounded
yearly. Hint: Find the present value...
As a new employee in the Lottery Commission, your first job is to design a new...
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Variable Selling and Admin Expenses
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Fixed selling & administrative expenses
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There are 3 decks of 20 cards each on the table:
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1.As an employee in the Lottery Commission, your job is to design a new prize. Your...
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design a new prize. Your idea is to create two grand prize choices:
(1) receiving $50,000 at the end of each year beginning in one year
for 20 consecutive years, or (2) receiving $500,000 today followed
by a one-time payment at the end of 20 years. Using an interest
rate of 3%, which of the following comes closest to the amount
prize (2) needs to pay at the end...
1.As an employee in the Lottery Commission, your job is to design a new prize. Your...
1.As an employee in the Lottery Commission, your job is to
design a new prize. Your idea is to create two grand prize choices:
(1) receiving $50,000 at the end of each year beginning in one year
for 20 consecutive years, or (2) receiving $500,000 today followed
by a one-time payment at the end of 20 years. Using an interest
rate of 3%, which of the following comes closest to the amount
prize (2) needs to pay at the end...
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payment in year 6, and only 6, is not $350 but $0. Using an
interest rate of 7%, determine the present value of this cash flow
stream.
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