Value of a retirement annuity Personal Finance Problem An insurance agent is trying to sell you an annuity, that will provide you with $5,500 at the end of each year for the next 15 years. If you don't purchase this annuity, you can invest your money and earn a return of 4%. What is the present value of the annuity? Ignoring taxes, the present value of the annuity is S (Round to the nearest cent)

Value of a retirement annuity Personal Finance Problem An insurance agent is trying to sell you an annuity, that will provide you with $5,500 at the end of each year for the next 15 years. If you don't purchase this annuity, you can invest your money and earn a return of 4%. What is the present value of the annuity? Ignoring taxes, the present value of the annuity is S (Round to the nearest cent)

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

Chapter4: Managing Your Cash And Savings

Section: Chapter Questions

Problem 7FPE: Calculating interest earned and future value of savings account. If you put 6,000 in a savings...

See similar textbooks

Similar questions

Calculating interest earned and future value of savings account. If you put 6,000 in a savings account that pays interest at the rate of 3 percent, compounded annually, how much will you have in five years? (Hint: Use the future value formula.) How much interest will you earn during the five years? If you put 6,000 each year into a savings account that pays interest at the rate of 4 percent a year, how much would you have after five years?
Value of a retirement annuity. Personal Finance Problem An insurance agent is trying to sell you an annuity, that will provide you with $ 14,000 at the end of each year for the next 15 years. If you don't purchase this annuity, you can invest your money and earn a return of 8%. What is the present value of the annuity?
Value of a retirement annuity Personal Finance Problem An insurance agent is trying to sell you an annuity, that will provide you with $5,100 at the end of each year for the next 30 years. If you don't purchase this annuity, you can invest your money and earn a return of 5%. What is the most you would pay for this annuity right now? Ignoring taxes, the most you would pay for this annuity is S. (Round to the nearest cent.)
You have received a settlement from an insurance company which will pay you $100,000 per year for 12 years at the end of each year and J.G. Wentworth wants to buy your annuity. What is JG Wentworth’s annual rate of return (interest rate) if they are willing to pay you $500,000 today? 7.56% 18.21% 16.94% Interest rate cannot be calculated.
Perpetuities A local bank will pay you $100 a year for your lidetime if you deposit $2,500 in the bank today. If you live forever, what interest rate is the bank paying you?
Lesson: Present Value of Ordinary Annuity A man has just taken retirement at age 50. He will receive 5,000 monthly in retirement benefits until he turns 60 and begins receiving Social Security benefits at which time the pension declines to only 3,000 per month for 5 years. What is the present value of his pension if he uses a rate of 7%?
ook ences Chris Seals has just given an insurance company $62,525. In return, she will receive an annuity of $7,458 for 12 years. a. At what rate of return must the insurance company invest this $62,525 to make the annual payments? (Use a Financial calculator to arrive at the answers. Round the final answer to 3 decimal places.) Rate of return b. What rate of return is required if the annuity is payable at the beginning of each year? (Use a Financial calculator to arrive at the answers. Round the final answer to 2 decimal places.) Rate of return
not use of excel to solve this question You take a 60,000 car loan at 5% interest for 4 years. How much will your monthly payments be? (use present value annuity)
How do you solve this on TI 84 Future Value of Multiple Annuities Assume that you contribute $110 per month to a retirement plan for 20 years. Then you are able to increase the contribution to $210 per month for another 20 years. Given a 6.5 percent interest rate, what is the value of your retirement plan after 40 years?
Your insurance agent is trying to sell you an annuity that costs $55,000 today. By buying this annuity, your agent promises that you receive payments of $285 per month for 30 years. What is the rate of return expressed as an APR on this investment? Multiple Choice O 3.91% 4.33% will
Suppose you wish to retire forty years from today. You determine that you need $50,000 per year once you retire, with the first retirement funds withdrawn one year from the day you retire. You estimate that you will earn 6% per year on your retirement funds and that you will need funds up to 25 years after retirement. Use the PV of an ordinary annuity due formula. a) Calculate the amount you must deposit in an account today so that you have enough funds for retirement b) Calculate the amount you must deposit each year, starting one year from today, so that you have enough funds for retirement.
Not sure where to start this one Suppose that you purchase a new home that costs $180,000. A local bank offers you a 3% fixed rate mortgage loan for 30 years. Also, you are required to make a 20% down payment immediately. a) Find your monthly payment. b) Find the interest amount and the principal amount in your first monthly payment. c) Find the total interest paid for 30 years.