After consulting with your financial advisor, you figured that you need $100,000 per year for your living during 35 years of the retirement period. You consider buying an annuity contract that will pay $100,000 at the end of every year. Assuming a rate of return of 8%, how much do you need today to buy the ordinary annuity contract? O $1,455,457 $1,165,980 $1,165,457 O $1,133,457
After consulting with your financial advisor, you figured that you need $100,000 per year for your living during 35 years of the retirement period. You consider buying an annuity contract that will pay $100,000 at the end of every year. Assuming a rate of return of 8%, how much do you need today to buy the ordinary annuity contract? O $1,455,457 $1,165,980 $1,165,457 O $1,133,457
Chapter5: The Time Value Of Money
Section: Chapter Questions
Problem 16P
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![After consulting with your financial advisor, you figured that you need $100,000 per year
for your living during 35 years of the retirement period. You consider buying an annuity
contract that will pay $100,000 at the end of every year. Assuming a rate of return of 8%,
how much do you need today to buy the ordinary annuity contract?
O $1,455,457
O $1,165,980
O $1,165,457
$1,133,457](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fa4b8ccc3-cc07-4f0f-af6d-77129f56180b%2F7471700a-fc5c-431f-b8af-6ee12a79957d%2Fsrn8rtc_processed.jpeg&w=3840&q=75)
Transcribed Image Text:After consulting with your financial advisor, you figured that you need $100,000 per year
for your living during 35 years of the retirement period. You consider buying an annuity
contract that will pay $100,000 at the end of every year. Assuming a rate of return of 8%,
how much do you need today to buy the ordinary annuity contract?
O $1,455,457
O $1,165,980
O $1,165,457
$1,133,457
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