Calculating the present value of an ordinary annuity) (Related to Checkpoint 6.2) Nicki Johnson, a sophomore mechanical engineering student, received a call from an insurance agent who believes that Nicki is an older woman who is ready to retire from teaching. He talks to her about several annuities that she could buy that would guarantee her a fixed annual income. The annuities are as follows: Annuity Purchase Price of the Annuity Amount of Money Received per Year Duration of the Annuity (years) A $50,000 $8,500 12 B $60,000 $7,000 25 C $70,000 $8,000 20 Nicki could earn 11 percent on her money by placing it in a savings account. Alternatively, she could place it in any of the above annuities. Which annuities in the table above, if any, will earn Nicki a higher return than investing in the savings account earning 11 percent?

Calculating the present value of an ordinary annuity) (Related to Checkpoint 6.2) Nicki Johnson, a sophomore mechanical engineering student, received a call from an insurance agent who believes that Nicki is an older woman who is ready to retire from teaching. He talks to her about several annuities that she could buy that would guarantee her a fixed annual income. The annuities are as follows: Annuity Purchase Price of the Annuity Amount of Money Received per Year Duration of the Annuity (years) A $50,000 $8,500 12 B $60,000 $7,000 25 C $70,000 $8,000 20 Nicki could earn 11 percent on her money by placing it in a savings account. Alternatively, she could place it in any of the above annuities. Which annuities in the table above, if any, will earn Nicki a higher return than investing in the savings account earning 11 percent?

Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)

7th Edition

ISBN:9780357033609

Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Chapter14: Planning For Retirement

Section: Chapter Questions

Problem 8FPE

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< (Related to Checkpoint 6.2) (Present value of an ordinary annuity) Nicki Johnson, a sophomore mechanical engineering student, receives a call from an insurance agent who believes that Nicki is an older woman who is ready to retire from teaching He talks to her about several annuities that she could buy that would guarantee her a fixed annual income. The annuities are as follows: Purchase Price of the Annuity (Att = 0) Annuity A B C (Click on the icon in order to copy its contents into a spreadsheet) $40,000 $50,000 $50,000 Amount of Money Received Per Year $6,000 $9,000 $6,500 Duration of the Annuity (Years) 22 12 25 Nicki could earn 11 percent on her money by placing it in a savings account Alternatively, she could place it in any of the above annuities. Which annuities in the table above, if any, will earn Nicki a higher return than investing in the savings account earning 11 percent? a. If Nicki could earn 11 percent on her money, what is the present value of annuity A with $6,000…
(Related to Checkpoint 6.2) (Present value of an ordinary annuity) Nicki Johnson, a sophomore mechanical engineering student, receives a call from an nsurance agent who believes that Nicki is an older woman who is ready to retire from teaching. He talks to her about several annuities that she could buy that would quarantee her a fixed annual income. The annuities are as follows: Purchase Price of the Amount of Money Duration of the Annuity (Years) 18 Annuity Annuity (At t = 0) Received Per Year $6,500 $6,000 A. $40,000 B $40.000 22 BCU IN $50,000 $7.500 16 (Click on the icon D in order to copy its contents into a spreadsheet.) Nicki could earn 12 percent on her money by placing it in a savings account Alternatively, she could place it in any of the above annuities. Which annuities in the table above, if any, will earn Nicki a higher return than investing in the savings account earning 12 percent? GTKY Gen a. If Nicki could earn 12 percent on her money, what is the present value of…
(Related to Checkpoint 6.2) (Present value of an ordinary annuity) Nicki Johnson, a sophomore mechanical engineering student, receives a call from an insurance agent who believes that Nicki is an older woman who is ready to retire from teaching. He talks to her about several annuities that she could buy that would guarantee her a fixed annual income. The annuities are as follows: Annuity A Purchase Price of the Annuity (Att 0) $40,000 B $60,000 C $60,000 (Click on the icon in order to copy its contents into a spreadsheet.) Amount of Money Received Per Year $6,500 $9,000 $8,000 Duration of the Annuity (Years) 15 18 20 Nicki could earn 11 percent on her money by placing it in a savings account. Alternatively, she could place it in any of the above annuities. Which annuities in the table above, if any, will earn Nicki a higher return than investing in the savings account earning 11 percent? a. If Nicki could earn 11 percent on her money, what is the present value of annuity A with $6,500…
st K (Related to Checkpoint 6.2) (Present value of an ordinary annuity) Nicki Johnson, a sophomore mechanical engineering student, receives a call from an insurance agent who believes that Nicki is an older woman who is ready to retire from teaching. He talks to her about several annuities that she could buy that would guarantee her a fixed annual income. The annuities are as follows: Purchase Price of the Annuity (At t= 0) Amount of Money Received Per Year $6,500 $6,000 $9,000 Annuity A $50,000 B $40,000 C $60,000 (Click on the icon in order to copy its contents into a spreadsheet.) EXZE Duration of the Annuity (Years) 16 12 10 Nicki could earn 8percent on her money by placing it in a savings account. Alternatively, she could place it in any of the above annuities. Which annuities in the table above. if anv. will earn Nicki a higher return than investing in the savings a. If Nicki could earn 8 percent on her money, what is the present value of annuity A with $6,500 payments per year…
2. Annuities - Johan, a sophomore management student, receives a call from an insurance agent who believed that Johan is an older man ready to retire from teaching. He talks to him about several annuities that she would buy that would guarantee her an annual fixed income. The annuities are as follows: Initial Payment into Annuity (at t = 0) Amount of Money Received per Year Duration of Annuity (Years) Annuity 12 $8,500 A $50,000 25 $7,000 В $60,000 20 $8,000 $70,000 If Johan could earn 11 percent on his money by placing it in a savings account, should he place it instead in any of the annuities? Which ones, if any? Why?
Directions: Determine whether each of the following situation is Simply Annuity or General Annuity. Write your answers on the space provided. 1. A life insurance contribution paid monthly while the interest is compounded quarterly. 2. Your mom decided to join their office cooperative and agreed to contribute P1000 per month beginning in January 2020 which will earn 3% compounded monthly. 3. Your parents are planning to save for their retirement. To do this, they want to set aside a portion of their salaries and contribute monthly for their retirement funds which will earn 5% compounded quarterly. 4. Your eldest brother applied for a term life insurance. His contribution per year is P40 000 that earns 12% compounded monthly for 20 years. 5. A college educational plan earns 4% compounded quarterly and payments are made quarterly. 6. Your eldest brother applied for a term life insurance. His contribution per year is P40 000 that earns 12% compounded monthly for 20 years. 7. A college…
Determine whether or not the following situation describes an annuity. If it is an annuity, determine whether the jackpot amount is the annuity's present value or future value. Also, determine whether it is an ordinary annuity or an annuity due.Sam won a lottery jackpot which will pay him $2250 every week for 20 years, starting immediately. Group of answer choices The situation describes a future value of an ordinary annuity. The situation describes a present value of an annuity due. The situation does NOT describe an annuity. The situation describes a future value of an annuity due. The situation describes a present value of an ordinary annuity.
(Solving for r with annuities) Nicki Johnson, a sophomore mechanical engineering student, receives a call from an insurance agent, who believes that Nicki is an older woman ready to retire from teaching. He talks to her about several annuities that she could buy that would guarantee her an annual fixed income. The annuities are as follows in the popup window: LOADING... . If Nicki could earn 11 percent on her money by placing it in a savings account, should she place it instead in any of the annuities? Which ones, if any? Why? a. What rate of return could Nicki earn on her money if she place it in annuity A with $7,000 payment per year and 10 years duration? nothing% (Round to two decimal places.) Help Me Solve ThisView an Example Get More Help Clear All Check Answer Data Table ANNUITY INITIAL PAYMENT INTO ANNUITY (AT t = 0) AMOUNT OF MONEY RECEIVED PER YEAR DURATION OF ANNUITY (YEARS) A $40,000…
I need help working this problem out. Figuring out what table to use, whether to use: compound value, present value, amount of annuity, present value of annuity, sinking fund value? Please explain in detail each step. Nina deposits $3400 into a savings account earning simple interest at 6.3% annually. She intends to leave the money in the bank for three years. How much money, including both principal and interest, can she withdraw at the end of this time?
i) Identify whether Simple or General Annuity ii) Identify whether Ordinary Annuity, Annuity Due, or Deferred Annuity iii) Using the formula, solve for the unknown iv) Use tabular presentation to support your answer 4) Clyde is setting up a fund of $12,000 fund to purchase a brand new cellphone. If he deposits $800 in a bank every end of the month which pays an interest of 9% compounded monthly, how long will it take him to raise the desired amount?
In the following exercises and problems you will be able to:• model investment and annuity problems;• explain the difference between sequences and series;• solve exercises applying concepts of the sum of sets of terms of a sequence, and• solve problems related to annuities using sequences or seriesIn the case that the result is decimal, you will round it to two decimal places. 3. The new parents decide to invest $ 100 a month in an annuity for their young daughter. The account will pay 5% interest per year, which is compounded monthly. How much will be in the child's account when he turns eighteen?
In the following exercises and problems you will be able to:• model investment and annuity problems;• explain the difference between sequences and series;• solve exercises applying concepts of the sum of sets of terms of a sequence, and• solve problems related to annuities using sequences or seriesIn the case that the result is decimal, you will round it to two decimal places. 4. New grandparents decide to invest $ 200 a month in an annuity for their grandchild. The account will pay 5% interest per year, which is compounded monthly. How much will be in the child's account when he turns 21?