The expected return on a life insurance policy. The Expected return: The expected return on an investment refers to the weighted average of estimated returns and estimation of occurrence of those returns. Life Insurance Policy: Life insurance policy is an agreement between two parties, the two parties are the insurance company and the policy buyer. The insurance company depicts to pay a predetermined amount to the policy holder in case of specified future events.

Question

Want to see the full answer?

Answer 1

Question

Chapter 8, Problem 3Q

a)

Summary Introduction

To explain: The expected return on a life insurance policy.

The Expected return:

The expected return on an investment refers to the weighted average of estimated returns and estimation of occurrence of those returns.

Life Insurance Policy:

Life insurance policy is an agreement between two parties, the two parties are the insurance company and the policy buyer. The insurance company depicts to pay a predetermined amount to the policy holder in case of specified future events.

b.

Summary Introduction

To explain: The correlation coefficient between the return on the insurance policy and the return on the human capital.

Correlation Coefficient:

A correlation coefficient is a tool of statistical measure. This tool measures the relation between the two variables. It measures how the change in one value of variable affects the other.

c.

Summary Introduction

To explain: The reason for buying the life insurance in spite of low expected returns.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

Class 3 5 7 10 15 20 Depreciation Year n 200% 200% 200% 200% 150% 150% rate 1 33.33 20.00 14.29 10.00 5.00 3.750 2 44.45 32.00 24.49 18.00 9.50 7.219 3 14.81* 19.20 17.49 14.40 8.55 6.677 4 7.41 11.52* 12.49 11.52 7.70 6.177 5 11.52 8.93 9.22 6.93 5.713 6 5.76 8.92 7.37 6.23 5.285 7 8.93 6.55* 5.90* 4.888 8 4.46 6.55 5.90 4.522 9 6.56 5.91 4.462* 10 6.55 5.90 4.461 11 3.28 5.91 4.462 12 5.90 4.461

Unite Assissment 02 : New City Band Part 02: Base & Flexible Budget Base Budget Flexible Budget Fixed or Variable Revenue City Contributions Fixed Annual Contribution F Per Concert Contributions V Public Contributions V Endowment Earnings F Total Revenue Expenses Conductors Stipend F Musicians Stipend V Insurance Fixed Insurance Premium F Per-Concert Insurance Premium V Music Costs Music Acquisitions F Performance Rights V Total Expenses Surplus/(Deficit)

Sonja Jensen is considering the purchase of a fast-food franchise. Sonja will be operating on a lot that is to be converted into a parking lot in six years, but that may be rented in the interim for $700 per month. The franchise and necessary equipment will have a total initial cost of $68,000 and a salvage value of $9,000 (in today's dollars) after six years. Sonja is told that the future annual general inflation rate will be 5%. The projected operating revenues and expenses (in actual dollars) other than rent and depreciation for the business are given in the table below. Assume that the initial investment will be depreciated under the five-year MACRS and that Sonja's tax rate will be 30%. Sonja can invest her money at a rate of at least 14% in other investment activities during this inflation-ridden period. Click the icon to view the projected operating revenues and expenses. Click the icon to view the MACRS depreciation schedules. (a) Determine the cash flows associated with the…

Answer 2

Question

Chapter 8, Problem 3Q

a)

Summary Introduction

To explain: The expected return on a life insurance policy.

The Expected return:

The expected return on an investment refers to the weighted average of estimated returns and estimation of occurrence of those returns.

Life Insurance Policy:

Life insurance policy is an agreement between two parties, the two parties are the insurance company and the policy buyer. The insurance company depicts to pay a predetermined amount to the policy holder in case of specified future events.

b.

Summary Introduction

To explain: The correlation coefficient between the return on the insurance policy and the return on the human capital.

Correlation Coefficient:

A correlation coefficient is a tool of statistical measure. This tool measures the relation between the two variables. It measures how the change in one value of variable affects the other.

c.

Summary Introduction

To explain: The reason for buying the life insurance in spite of low expected returns.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 8, Problem 3Q

a)

Summary Introduction

To explain: The expected return on a life insurance policy.

The Expected return:

The expected return on an investment refers to the weighted average of estimated returns and estimation of occurrence of those returns.

Life Insurance Policy:

Life insurance policy is an agreement between two parties, the two parties are the insurance company and the policy buyer. The insurance company depicts to pay a predetermined amount to the policy holder in case of specified future events.

b.

Summary Introduction

To explain: The correlation coefficient between the return on the insurance policy and the return on the human capital.

Correlation Coefficient:

A correlation coefficient is a tool of statistical measure. This tool measures the relation between the two variables. It measures how the change in one value of variable affects the other.

c.

Summary Introduction

To explain: The reason for buying the life insurance in spite of low expected returns.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 8, Problem 3Q

a)

Summary Introduction

To explain: The expected return on a life insurance policy.

The Expected return:

The expected return on an investment refers to the weighted average of estimated returns and estimation of occurrence of those returns.

Life Insurance Policy:

Life insurance policy is an agreement between two parties, the two parties are the insurance company and the policy buyer. The insurance company depicts to pay a predetermined amount to the policy holder in case of specified future events.

b.

Summary Introduction

To explain: The correlation coefficient between the return on the insurance policy and the return on the human capital.

Correlation Coefficient:

A correlation coefficient is a tool of statistical measure. This tool measures the relation between the two variables. It measures how the change in one value of variable affects the other.

c.

Summary Introduction

To explain: The reason for buying the life insurance in spite of low expected returns.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 8, Problem 3Q

a)

Summary Introduction

To explain: The expected return on a life insurance policy.

The Expected return:

The expected return on an investment refers to the weighted average of estimated returns and estimation of occurrence of those returns.

Life Insurance Policy:

Life insurance policy is an agreement between two parties, the two parties are the insurance company and the policy buyer. The insurance company depicts to pay a predetermined amount to the policy holder in case of specified future events.

b.

Summary Introduction

To explain: The correlation coefficient between the return on the insurance policy and the return on the human capital.

Correlation Coefficient:

A correlation coefficient is a tool of statistical measure. This tool measures the relation between the two variables. It measures how the change in one value of variable affects the other.

c.

Summary Introduction

To explain: The reason for buying the life insurance in spite of low expected returns.

Answer 6

Chapter 8, Problem 3Q

a)

Summary Introduction

To explain: The expected return on a life insurance policy.

The Expected return:

The expected return on an investment refers to the weighted average of estimated returns and estimation of occurrence of those returns.

Life Insurance Policy:

Life insurance policy is an agreement between two parties, the two parties are the insurance company and the policy buyer. The insurance company depicts to pay a predetermined amount to the policy holder in case of specified future events.

Answer 7

Chapter 8, Problem 3Q

a)

Summary Introduction

To explain: The expected return on a life insurance policy.

The Expected return:

The expected return on an investment refers to the weighted average of estimated returns and estimation of occurrence of those returns.

Life Insurance Policy:

Life insurance policy is an agreement between two parties, the two parties are the insurance company and the policy buyer. The insurance company depicts to pay a predetermined amount to the policy holder in case of specified future events.

Answer 8

b.

Summary Introduction

To explain: The correlation coefficient between the return on the insurance policy and the return on the human capital.

Correlation Coefficient:

A correlation coefficient is a tool of statistical measure. This tool measures the relation between the two variables. It measures how the change in one value of variable affects the other.

Answer 9

b.

Summary Introduction

To explain: The correlation coefficient between the return on the insurance policy and the return on the human capital.

Correlation Coefficient:

A correlation coefficient is a tool of statistical measure. This tool measures the relation between the two variables. It measures how the change in one value of variable affects the other.

Answer 10

c.

Summary Introduction

To explain: The reason for buying the life insurance in spite of low expected returns.

Answer 11

c.

Summary Introduction

To explain: The reason for buying the life insurance in spite of low expected returns.

Answer 12

Expert Solution & Answer

Answer 13

Expert Solution & Answer

Answer 14

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 15

Ch. 8 - Suppose you owned a portfolio consisting of...Ch. 8 - Prob. 2Q Ch. 8 - Prob. 3Q Ch. 8 - Is it possible to construct a portfolio of...Ch. 8 - Stock A has an expected return of 7%, a standard...Ch. 8 - A stock had a 12% return last year, a year when...Ch. 8 - If investors aversion to risk increased, would the...Ch. 8 - Prob. 8Q Ch. 8 - In Chapter 7, we saw that if the market interest...Ch. 8 - Suppose you own Stocks A and B. Based on data over...

To explain: The reason for buying the life insurance in spite of low expected returns.

Want to see the full answer?

Chapter 8 Solutions