Your insurance agent is trying to sell you an annuity that costs $80,000 today. By buying this annuity, your agent promises that you will receive payments of $445 per month for 30 years. What is the rate of return expressed as an APR on this investment? Multiple Choice O 4.91% 5.32% 4.43% 5.23%

Your insurance agent is trying to sell you an annuity that costs $80,000 today. By buying this annuity, your agent promises that you will receive payments of $445 per month for 30 years. What is the rate of return expressed as an APR on this investment? Multiple Choice O 4.91% 5.32% 4.43% 5.23%

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Question

Your insurance agent is trying to sell you an annuity that costs $80,000 today. By buying this annuity, your agent promises that you will receive payments of $445
per month for 30 years. What is the rate of return expressed as an APR on this investment?
Multiple Choice
O
4.91%
5.32%
4.43%
5.23%

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You have a chance to buy an annuity that pays Php2,500 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? SHOW MANUAL SOLVING
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Find the future value for the ordinary annuity with the given pa PMT = $1,600; 1.35% compounded monthly for 6 years. %3D 0.0135 Substitute the values PMT = 1,600, i= 12 and n= 72 into result. FV = PMT (1 + i)" – 0.0135 ) 72 1+ -1 12 = 1,600 0.0135 12 Simplif Enter your answer in the answer box and then click Check Ar Olear Al 1 part remaining answ showing hp
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Consider a growing perpetuity that will pay $100 in one year. Each year after that, you will receive a payment on the anniversary of the last payment that is 6% larger than the last payment. This pattern of payments will continue forever. If the interest rate is 11%, then the value of this perpetuity is closest to: Group of answer choices $1,667 $588 $2000 $909
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