You Have Won the Lottery and Received a Check for $1,275,156

Multiple Choice

You have won the lottery and received a check for $1,275,156 today.You invest the lottery check today at an annual interest rate of 8% and allow it to build for a full ten years.At that point in time,you shift the money to an account paying only 6% per year.You plan to spend $175,000 per year in retirement (assume equal annual end-of-the-year cash flows) for 30 years,and your first retirement cash flow is exactly eleven years from today.Will you have enough money to fully fund your desired retirement? Use a calculator to determine your answer.

A) Yes,because your investment will allow you to spend up to $225,000 per year in retirement.
B) No,because your investment will allow you to spend up to only $158,000 per year in retirement.
C) Yes,because your investment will allow you to spend up to $200,000 per year in retirement.
D) No,because your investment will allow you to spend up to only $137,000 per year in retirement.