An insurance company offers you an annuity of $36,000 per year for the next 15 years. They claim your return on the annuity is 13%. What should you be willing to pay today for the annuity?
2) A financial instrument that agrees to pay an equal amount of money per period into the indefinite future (i.e. forever) is
a)perpetuity.
b)annuity.
c)annuity due.
d)sinking fund.
3)You invest $100 every monthly. The annual rate is 3% and you will invest for 20 years. How much money will you have in 20 year?