Question

In 1893, the first Green Jacket Golf Championship was held. The winner’s prize money was $230. In 2015, the winner’s check was $1,570,000. What was the annual percentage increase in the winner’s check over this period? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Annual percentage % If the winner’s prize increases at the same rate, what will it be in 2043? (Enter your answer in dollars, not millions of dollars, e.g., 1,234,567. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Prize money $

Answer 1

Step-by-step explanation:

A=P(1+r/100)^n

A=future value

P=present value

r=rate of interest

n=time period.

1,570,000=230*(1+r/100)^122

(1,570,000/230)^(1/122)=(1+r/100)

(1+r/100)=1.0750

r=1.0750-1 =7.50% annual % increase

Prize money = A =1,570,000*(1.0750)^28

=$11908951.1