determine the function which can be used to compute annual premiums.
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Insurance Premiums, An Insurance company has a simplified method for determining the annual premium for a turn life insurance policy. A flat annual fee of $150 is charged for all policies plus $2.50 for each thousand dollars of the amount of the policy. For example, a $20,000 policy would cost $150 for the fixed fee plus $50, which corresponds to the face value of the policy. If p equals the annual premium in dollars and x equals the face value of the policy (stated in thousands of dollars), determine the function which can be used to compute annual premiums.
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- Calculate the annual premium for the following policy. (Use Table 20.1.) Amount of coverage (face value of policy) Age and sex of insured Type of insurance policy Annual premium $200,000 42 (M) 20-payment lifeLive Forever Insurance Company is selling a perpetual annuity contract that pays $2,700 monthly. The contract currently sells for $329,000. a. What is the monthly return on this investment vehicle? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. b. What is the APR? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. c. What is the effective annual return? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. a. Monthly return b. Annual percentage rate c. Effective annual return % % %Live Forever Life Insurance Company is selling a perpetuity contract that pays $1,550 monthly. The contract currently sells for $116,000. a. What is the monthly return on this investment vehicle? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. What is the APR? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) c. What is the effective annual return? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) a. Monthly return b. APR c. EAR % % %
- Calculate the short-term premium and refund for the policy (in $). Use Table 19-5, if necessary. AnnualPremium CanceledAfter CanceledBy Short-Term Premium Refund $570 25 days insured $ $Find the following: (Round your answer to the nearest cent.) Face Value Age and Sex of Insured Type of Insurance Annual Premium $26,000 37F Straight LifeA life insurance company pays investors 4% compounded annually on its five-year GICs. For you to be indifferent as to which compounding option you choose, what would the nominal rates have to be on GICs with quarterly compounding?
- A life insurance company offers loans to its policyholders against the cash value of their policies at a (nominal) annual interest rate of 6 percent, compounded monthly. Determine the effective annual percentage interest rate on these loans. Round your answer to two decimal places.A borrower with a 645 credit score is buying a $449,481 home with 95% LTV financing. The percent annual premium from the private mortgage insurance (PMI) company is 1.43% for a 30% coverage policy. The borrower's monthly premium payment is? Note: the question is asking for the monthly premium only, not the loan payment + premium. (Input your answer rounded to the nearest whole penny and without the $ sign, e.g., 1000.01)The following payment plans are offered on the purchase of an appliance. P375 8 monthly payments of P55. P100 cash down and 6 monthly payments of P50. Which payment plan would you choose if interest is 24% annually, compounded monthly, if you are the purchaser? Assume ordinary annuities where applicable Show step by step solution: Manually
- Calculate the short-term premium and refund for the policy (in $). AnnualPremium CanceledAfter CanceledBy Short-Term $510 25 days insured $ premium $refundWith respect to using traditional lending rules to determine how much of a mortgage a borrower qualifies for, most lenders apply the rule that results in the highest mortgage amount. O The above statement is True. O The above statement is False.Calculate the amount financed, the finance charge, and the total deferred payment price for the following installment loan. Round your answers to the nearest cent. Total Purchase Deferred (Cash) Down Amount Monthly Number of Finance Payment Price Payment Financed Payment Payments Charge Price $2,800 0% $190.35 24