A company wants to provide a retirement plan for an employee who is aged 55 now. The plan will provide her with an annuity‐immediate of $7,000 every year for 15 years upon her retirement at the age of 65. The company is funding this plan with an annuity‐due of 10 years. If the rate of interest is 5%, what is the amount of installment the company should pay?
A company wants to provide a retirement plan for an employee who is aged 55 now. The plan will provide her with an annuity‐immediate of $7,000 every year for 15 years upon her retirement at the age of 65. The company is funding this plan with an annuity‐due of 10 years. If the rate of interest is 5%, what is the amount of installment the company should pay?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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PLS ANSWER AND SHOW CASH FLOW.
A company wants to provide a retirement plan for an employee who is aged 55 now. The plan will
provide her with an annuity‐immediate of $7,000 every year for 15 years upon her retirement at the
age of 65. The company is funding this plan with an annuity‐due of 10 years. If the rate of interest is
5%, what is the amount of installment the company should pay?
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PLS SHOW THE CASH FLOW OF THE PROBLEM NOT THE CASH FLOW OF THE ANSWER. THANK YOU
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