Determine the annual payment required to fund a future annual annuity of $12,000 per year. You will fund this future liability over the next five years, with the first payment to occur one year from today. The future $12,000 liability will last for four years, with the first payment to occur seven years from today. If you can earn 8 percent on this account, how much will you have to deposit each year over the next five years to fund the future liability?

Q: At the end of each month for the next ten years you will receive cash flows of $75.  If the…

A: Present value of annuity = 75{1-(1+0.072)^-120}/0.072

Q: Bill Jones plans to deposit $2100 at the end of every 6 months for the next 20 years into an annuity…

A: Calculation of the total value of the annuity at the maturity is shown below: Hence, the total…

Q: You are currently at time period 0, and you will receive the first payment on an annual payment…

A: Annuity is the series of equal cash payments over the period.

Q: dymer increase by 2% for the next year. Find the present value of this annuity if the initial…

A: The present value of annuity includes the value of annuities discounted at the rate of interest rate…

Q: Anita is considering the purchase of a five year annuity of 10 semiannual payments of $6,000 made at…

A: Annuity refers to the fixed amount to be received by the insurer for the rest of the life against…

Q: You are going to receive three perpetuities. Perpetuity 1 will pay $450 each year, with the first…

A: A perpetuity is a cash flow or an annuity that goes on forever.   To solve this question we need to…

Q: The Solvent Insurance Co. will pay you $4,750 a year for 15 years in exchange for $45,000 today.…

A: in this you have to find out present value FACTOR and from that you can get interest rate.

Q: How much would you be willing to pay today for an ordinary annuity that makes equal annual payments…

A: An ordinary annuity is the series of an equal payment that is paid or received at each week, month,…

Q: What must YOU invest today to receive an annuity of $4,500 for 10 years compounded at 8% quarterly…

A: PV of Annuity =P1-1(1+r)n r Where PV = Present Value r  = rate of interest n = Number of Period P =…

Q: Roger Baker has accumulated $775,000 in his RRSP and is going to purchase a 20-year annuity from…

A: An Annuity is simply a fixed amount which will be received by Roger Baker at every month-end Present…

Q: Jami Minard wants to receive an annuity of $8,000 at the beginning of each year for the next 10…

A: Annuity refers to a contract between an individual and an insurance company under which a desired…

Q: PNC's 30-year annuity is scheduled to pay off a loan taken out today at a 5% annual effective…

A: given, year (n) = 30 rate = 5% first annuity at t=10, amount= $10,000 then annuity increase by $5000…

Q: What is the present value of an annuity of $4000 received at the beginning of each year for the…

A: The present value of an annuity is an estimate of the present worth of future annuity payments based…

Q: Your pension plan is an annuity with a guaranteed return of 5.8% per year (compounded quarterly).…

A: To solve this problem, we need to break it down into two main parts:1. Accumulation Phase (Before…

Q: What is the future value of a 7%, 5-year annuity that pays $300 at the beginning of each year?

A: Given: Rate: 7% Annuity =300      Number of years = 5

Q: If your trust fund promises to pay you $25, 000 on your 24th birthday (6years from today) and earns…

A: Present Value is the current worth of an amount to be received in future. To calculate the present…

Q: You are set to receive an annual payment of $11,200 per year for the next 18 years. Assume the…

A: Given the following: Annual payment, A = $11,200  Period, n = 18 years  Interest rate, r = 6.1%

Q: A trust notifies you that you are entitled a grant that would give you annual payments of $6,200 per…

A: Answer: Calculation of the present value of the grant: The present value of the grant will be equal…

Q: A perpetuity pays $100 each year, with the first payment scheduled two years from now. Assume that…

A: Amount of $100 will be paid by a perpetuity and that will be started from year 2 (two year from…

Q: If you want to be paid from a 15 year ordinary annuity with a guaranteed rate of 4.277% compounded…

A: Annual payment (C) = $10,000 Period (n) = 15 Years rate (r) = 0.04277 (i.e. 4.277%) Present value or…

Q: Beginning a year from now, Bernardo O’Reilly will receive $20,000 a year from his pension fund.…

A: Present value is the current worth of future payments from the specific investment.…

Q: A perpetuity will pay $736 per year, starting five years after the perpetuity is purchased. (The…

A: Present value refers to the current worth or value of a future sum of money or cash flow. It is the…

Q: Annuity will pay $200 at the end of each of the next 10 years and $600 at the end of each of the…

A: The Present Value of Annuity (PVA) is a financial concept that calculates the current worth of a…

Q: Your pension plan is an annuity with a guaranteed return of 4% per year (compounded quarterly). You…

A: Formula for Calculating Future Value = PMT [(1+i)n - 1] / i Here, PMT = 1600              i    =…

Q: What is the future value​ (FV) of this​ perpetuity, given that the interest rate is 3​%?

A: The future value of an investment forecasts the expected value of an investment at a given future…

Q: Assume you are to receive a 5-year annuity with annual payments of £1,000. The first payment will be…

A: The Future Value of an Ordinary Annuity refers to the concept which gives out the compounded or…

Q: The present value of a 4-year annuity is $47,000. The first annual cash flow occurs one year from…

A: The discount rate is 4.8%The present value of the annuity table of discount rate 4.8%.PeriodAnnuity…

Q: Determine the present value of an annuity due of $5,000 per year for 15 years discounted back to the…

A: Using excel PV function

Q: An annuity provides for 12 annual payments. The first payment is $100, paid at the end of the first…

A: The above example is the type of growing annuity. We need to find out the present value of this…

Q: You purchase an ordinary annuity with 4% interest and will receive regular quarterly payments of…

A: The interest rate is 4% Quarterly rate, the rate is 4%4= 1% Regular Quarterly payment, PMT is $4500…

Q: At the end of each month for the next ten years you will receive cash flows of $50.  If the…

A: Annuity refers to the contract between an insurer and the insurance company in which a fixed…

Q: Find out how much you should deposit now at 9% interest, compounded annually, to yield an annuity…

A: Present value = ( a / r) * { 1 - 1 / (1 + r ) ^ n }

Q: An annuity pays $1000 at the end of each year for 4 years and then $2000 at the end of each year for…

A: Required :The discounted value of these cash flows.

Q: You need to have $30,750 in 11 years. You can earn an annual interest rate of 6 percent for the…

A: To calculate the deposit amount we will use the below formula   Deposit amount =…

Q: what is the value of this annuity five years from now? What is the value three years from now? What…

A: An annuity is a series of payments which starts from 1st period and can end at any period, annuity…

Q: You are given an annuity-immediate paying 14 for 14 years, then increasing by one per year for 8…

A: An annuity's present value is the current value of all of its future cash flows discounted, using a…

Q: Mr. Romeo wants to deposit a sum of money today that will give an ordinary annuity paying 12,000…

A: The value of annuity can be computed as sum of present value of all withdrawals

Q: what is the value of the annuity today

A: We can determine the PV of annuity to year 3 and then discount it to year 0 using PV formula. r =…

Types of Insurance Contract

Insurance is a contract wherein an individual or entity gets financial protection from the insurance company for any damages or losses incurred. The individual or entity is called the insured, whereas the insurance company is called the insurer. The insured and the insurer enter a legal contract for a fixed term called the insurance term, and the contract is called an insurance policy.