Assume that you own an annuity that will pay you $14,000 per year for 12 years, with the first payment being made today. You need money today to start a new business, and your uncle offers to give you $125,000 for the annuity. If you sell it, what rate of return would your uncle earn on his investment?   a. 11.20%     b. 4.46%     c. 4.87%     d. 20.01%     e. 5.90%

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A: The amount to be paid for the policy can be computed as follows :

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A: A down payment is an early stage payment made for a particular good purchased through financing.

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