James (aged 33) and his wife, Jennie (aged 30), have just purchased a new condominium for $550,000. They plan to take a 80% mortgage loan of $440,000 for the next 35 years. James has the following assets: BMW car $65,000 stocks on (stock exchange of America) $180,000 group insurance by his employers $400,000 personal insurance $250,000 James has a hire purchase loan on the BMW car amounting to $40,000. Should he pre-decease Jennie, James Plans to provide $36,000 per annum for Jennie till she reaches age 70. James would also like to create an Emergency Buffer fund of $50,000 and Final Expenses fund of $35,000. Using the CAPITAL LIQUIDATION method, compute the amount of additional life insurance that James needs to purchase. Assume a discount rate of 4% per annum and that income is received at the end of the period. ww m In the example above; as life mortality is uncertain, James would like to provide for his wife, Jennie, an income of $36,000 for an indefinite time period. Using the CAPITAL PRESERVATION method, compute the amount of additional life insurance that James needs to purchase. Assume a discount rate of 4% per annum and that income is received at the end of the period.
James (aged 33) and his wife, Jennie (aged 30), have just purchased a new condominium for $550,000. They plan to take a 80% mortgage loan of $440,000 for the next 35 years. James has the following assets: BMW car $65,000 stocks on (stock exchange of America) $180,000 group insurance by his employers $400,000 personal insurance $250,000 James has a hire purchase loan on the BMW car amounting to $40,000. Should he pre-decease Jennie, James Plans to provide $36,000 per annum for Jennie till she reaches age 70. James would also like to create an Emergency Buffer fund of $50,000 and Final Expenses fund of $35,000. Using the CAPITAL LIQUIDATION method, compute the amount of additional life insurance that James needs to purchase. Assume a discount rate of 4% per annum and that income is received at the end of the period. ww m In the example above; as life mortality is uncertain, James would like to provide for his wife, Jennie, an income of $36,000 for an indefinite time period. Using the CAPITAL PRESERVATION method, compute the amount of additional life insurance that James needs to purchase. Assume a discount rate of 4% per annum and that income is received at the end of the period.
Algebra and Trigonometry (6th Edition)
6th Edition
ISBN:9780134463216
Author:Robert F. Blitzer
Publisher:Robert F. Blitzer
ChapterP: Prerequisites: Fundamental Concepts Of Algebra
Section: Chapter Questions
Problem 1MCCP: In Exercises 1-25, simplify the given expression or perform the indicated operation (and simplify,...
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Question
![James (aged 33) and his wife, Jennie (aged 30), have just purchased a new
condominium for $550,000. They plan to take a 80% mortgage loan of $440,000 for
the next 35 years.
James has the following assets:
BMW car
$65,000
stocks on (stock exchange of America)
$180,000
group insurance by his employers
$400,000
personal insurance
$250,000
James has a hire purchase loan on the BMW car amounting to $40,000. Should he
pre-decease Jennie, James Plans to provide $36,000 per annum for Jennie till she
reaches age 70. James would also like to create an Emergency Buffer fund of $50,000
and Final Expenses fund of $35,000. Using the CAPITAL LIQUIDATION method,
compute the amount of additional life insurance that James needs to purchase.
Assume a discount rate of 4% per annum and that income is received at the end of the
period.
ww m
In the example above; as life mortality is uncertain, James would like to provide for
his wife, Jennie, an income of $36,000 for an indefinite time period. Using the
CAPITAL PRESERVATION method, compute the amount of additional life
insurance that James needs to purchase. Assume a discount rate of 4% per annum and
that income is received at the end of the period.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe44ec121-40f7-419a-8dcb-77d58303787f%2F7cfc1f36-b3e4-4c12-ba99-5036619bc25c%2Fmu6u5af_processed.jpeg&w=3840&q=75)
Transcribed Image Text:James (aged 33) and his wife, Jennie (aged 30), have just purchased a new
condominium for $550,000. They plan to take a 80% mortgage loan of $440,000 for
the next 35 years.
James has the following assets:
BMW car
$65,000
stocks on (stock exchange of America)
$180,000
group insurance by his employers
$400,000
personal insurance
$250,000
James has a hire purchase loan on the BMW car amounting to $40,000. Should he
pre-decease Jennie, James Plans to provide $36,000 per annum for Jennie till she
reaches age 70. James would also like to create an Emergency Buffer fund of $50,000
and Final Expenses fund of $35,000. Using the CAPITAL LIQUIDATION method,
compute the amount of additional life insurance that James needs to purchase.
Assume a discount rate of 4% per annum and that income is received at the end of the
period.
ww m
In the example above; as life mortality is uncertain, James would like to provide for
his wife, Jennie, an income of $36,000 for an indefinite time period. Using the
CAPITAL PRESERVATION method, compute the amount of additional life
insurance that James needs to purchase. Assume a discount rate of 4% per annum and
that income is received at the end of the period.
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