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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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Answer:

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