Terms of Two Actuarially Equivalent Annuities: Annuity A: $500 at the End

Multiple Choice

Terms of two actuarially equivalent annuities: Annuity A: $500 at the end of each of the first 3 months, and $1,000 at the end of each of the next 9 months Annuity B: X at the end of each of the first 2 quarters, and 2X at the end of the next 2 quarters Interest rate: 8% per year, compounded monthly In what range is X?

A) Less than $1,770
B) $1,770 but less than $1,800
C) $1,800 but less than $1,830
D) $1,830 but less than $1,860
E) $1,860 or more