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Your Aunt Is About to Retire, and She Wants to Buy

Question 27

Multiple Choice

Your aunt is about to retire, and she wants to buy an annuity that will provide her with $65,000 of income a year for 25 years, with the first payment coming IMMEDIATELY. The going rate on such annuities is 6.25%. How much would it cost her to buy the annuity today?


A) $739,281.38
B) $778,190.93
C) $819,148.35
D) $862,261.42

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