As a settlement for an insurance claim, Craig was offered one of two choices. He could either accept a lump-sum amount of $10,363 now, or accept monthly payments of $171 for the next six years. If the money is placed into a trust fund earning 5.39% compounded quarterly, which is the better option and by how much? Which option is better? Lump sum, or monthly payment? and its better by how much?
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- As a settlement for an insurance claim, Craig was offered one of two choices. He could either accept a lump-sum amount of $2207 now, or accept quarterly payments of $143 for the next five years. If the money is placed into a trust fund earning 4.71% compounded annually, which is the better option and by how much?A policyholder wishes to annuitize the cash value of her insurance policy at retirement. She desires an annual payment of $97.8,000 per year and the cash value is expected to be $1.5 million at retirement. Approximately how many payments can she expect to receive if annuity interest rates are 5.739 percent? (Do not round intermediate calculations. Round your answer to a whole number.)As a settlement for an insurance claim, Craig was offered one of two choices. He could either accept a lump-sum amount of $2148 now, or accept quarterly payments of $125 for the next five years. If the money is placed into a trust fund earning 3.24% compounded annually, which is the better option and by how much?
- As a settlement for an insurance claim, Craig was offered one of two choices. He could either accept a lump-sum amount of $4635 now, or accept quarterly payments of $194 for the next eight years. If the money is placed into a trust fund earning 6.18% compounded semi-annually, which is the better option and by how much? The option is better by $ (Rou est cent as needed. Round all intermediate values to six decimal places as needed.) lump sum quarterly paymentsAs a settlement for an insurance claim, Craig was offered one of two choices. He could either accept a lump-sum amount of $11,235 now, or accept monthly payments of $140 for the next nine years. If the money is placed into a trust fund earning 7.64% compounded annually, which is the better option and by how much?If the Alfa Life Insurance Co. will pay you and your heirs $1 at the beginning of each year forever, how much will you pay for the policy assuming the required return on this investment is 1 percent?
- Your uncle named you beneficiary of his life insurance policy. The insurance companygives you a choice of $100,000 today or a 12-year annuity of $12,000 at the endof each year. What rate of return is the insurance company offering? (6.11%)You are the beneficiary of a life insurance policy. The insurance company informs you that you have two options for receiving the insurance proceeds. You can receive a lump sum of $400,000 today or receive payments of $16,000 a year for 15 years. You can earn 6 percent on your money. Which option should you take and why?Gustav desires to deposit with a Trust Company a sum just sufficient to provide his family with an annuity of $600 per month for twenty-four years. How much he deposit if the Trust Company agrees to accumulate interest at the rate of 6% payable monthly? show solution
- An insurance settlement of $2.5 million must replace Trixie Eden's income for the next 40 years. What income will this settlement provide at the end of each month if it is invested in an annuity that earns 7.3%, compounded monthly? (a) Decide whether the problem relates to an ordinary annuity or an annuity due. ordinary annuity annuity due (b) Solve the problem. (Round your answer to the nearest cent.)You are the beneficiary of a life insurance policy. The insurance company informs you that you have two options for receiving the insurance proceeds. You can receive a lump sum of $200,000 today or receive payments of $1,400 a month for 20 years. You can earn 6 percent on your money. Which option should you take and why?Mrs. Crawford will receive $9,250 a year for the next 14 years from her trust. Use Appendix D for an approximate answer, but calculate your final answer using the formula and financial calculator methods.If a 8 percent interest rate is applied, what is the current value of the future payments? (Do not round intermediate calculations. Round your final answer to 2 decimal places.)