Part 1 A state establishes a sinking fund of $300 million for bonds that will mature in 20 years. How much money (in dollars) must be deposited at the end of each month into an account that earns an annual interest rate of 2% combounded monthly to retire the $300-million bond debt? (Round your answer to the nearest cent.) Part 2 The winner of a lottery chooses to receive annual payments of $180,000 at the end of each year for 25 years. If the current interest rate is 5.9%, find the present value (in dollars) of the payments (Round your answer to the nearest cent.)

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Characteristics of Bonds