Solved

You Have a Chance to Buy an Annuity That Pays

Question 147

Multiple Choice

You have a chance to buy an annuity that pays $2,500 at the end of each year for 3 years.You could earn 5.5% on your money in other investments with equal risk.What is the most you should pay for the annuity?


A) $5,493.71
B) $5,782.85
C) $6,087.21
D) $6,407.59
E) $6,744.83

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Q52: The greater the number of compounding periods

Q86: Disregarding risk, if money has time value,

Q115: A $150,000 loan is to be amortized

Q122: If the discount (or interest) rate is

Q126: Starting to invest early for retirement reduces

Q142: Your father paid $10,000 (CF at t

Q144: You are considering an investment in a

Q145: You are negotiating to make a 7-year

Q149: You plan to invest in securities that

Q150: You want to quit your job and