Question

1)A 60-year-old grandmother wants a life insurance policy that
could replace

her annual $55,000 earnings for the next 10 years. If the long-term
interest rate is now

6.2%, how large of a life insurance policy does she need?

2)You can afford monthly deposits of $200 into an account that
pays 6.2%

compounded monthly. How many months will it be until you have
$15,000 to buy a car?

Answer #1

A 60-year-old grandmother wants a life insurance policy that
could replace her annual $55,000 earnings for the next 10 years. If
the long-term interest rate is now 6.2%, how large of a life
insurance policy does she need?

Jim is a 60-year-old Anglo male in reasonably good health. He
wants to take out a $50,000 term (i.e., straight death benefit)
life insurance policy until he is 65. The policy will expire on his
65th birthday. The probability of death in a given year is
provided.
x = age
60
61
62
63
64
P(death at this
age)
0.01009
0.01426
0.01681
0.02059
0.02254
Jim is applying to Big Rock Insurance Company for his term
insurance policy.
(a) What is...

Jim is a 60-year-old Anglo male in reasonably good health. He
wants to take out a $50,000 term (i.e., straight death benefit)
life insurance policy until he is 65. The policy will expire on his
65th birthday. The probability of death in a given year is
provided. x = age 60 61 62 63 64 P(death at this age) 0.01165
0.01429 0.01759 0.01939 0.02314 Jim is applying to Big Rock
Insurance Company for his term insurance policy. (a) What is...

1. Just before his first attempt at bungee jumping, John decides
to buy a life insurance policy. His annual income at age 30 is
$39,000, so he figures he should get enough insurance to provide
his wife and new baby with that amount each year for the next 35
years. If the long-term interest rate is 6.1%, what is the present
value of John's future annual earnings? (Round your answer to the
nearest cent.)
$
Rounding up to the next...

Jim is a 60-year-old Anglo male in reasonably good health. He
wants to take out a $50,000 term (i.e., straight death benefit)
life insurance policy until he is 65. The policy will expire on his
65th birthday.
The probability of death in a given year is provided. x = age 60
61 62 63 64 P(death at this age) 0.01045 0.01402 0.01633 0.01987
0.02206
Jim is applying to Big Rock Insurance Company for his term
insurance policy.
(a) What is...

Jim is a 60-year-old Anglo male in reasonably good health. He
wants to take out a $50,000 term (that is, straight death benefit)
life insurance policy until he is 65. The policy will expire on his
65th birthday. The probability of death in a given year is provided
by the Vital Statistics Section of the Statistical Abstract of the
United States (116th Edition). x = age 60 61 62 63 64 P(death at
this age) 0.01165 0.01321 0.01750 0.01900 0.02356...

Jim is a 60-year-old Anglo male in reasonably good health. He
wants to take out a $50,000 term (that is, straight death benefit)
life insurance policy until he is 65. The policy will expire on his
65th birthday. The probability of death in a given year is provided
by the Vital Statistics Section of the Statistical Abstract of
the United States (116th Edition).
x = age
60
61
62
63
64
P(death at this
age)
0.01105
0.01378
0.01747
0.01915
0.02269...

Jim is a 60-year-old Anglo male in reasonably good health. He
wants to take out a $50,000 term (that is, straight death benefit)
life insurance policy until he is 65. The policy will expire on his
65th birthday. The probability of death in a given year is provided
by the Vital Statistics Section of the Statistical Abstract of the
United States (116th Edition).
x = age: 60, 61, 62, 63, 64
P(death at this age): 0.01105, 0.01390, 0.01765, 0.01945,
0.02365...

Jim is a 60-year-old Anglo male in reasonably good health. He
wants to take out a $50,000 term (that is, straight death benefit)
life insurance policy until he is 65. The policy will expire on his
65th birthday. The probability of death in a given year is provided
by the Vital Statistics Section of the Statistical Abstract of the
United States (116th Edition). x = age 60 61 62 63 64 P(death at
this age) 0.01036 0.01480 0.01600 0.02032 0.02230...

Jim is a 60-year-old Anglo male in reasonably good health. He
wants to take out a $50,000 term (that is, straight death benefit)
life insurance policy until he is 65. The policy will expire on his
65th birthday. The probability of death in a given year is provided
by the Vital Statistics Section of the Statistical Abstract of
the United States (116th Edition).
60
61
62
63
64
0.01030
0.01426
0.01687
0.02074
0.02221
(a) What is the probability that Jim...

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