Daryl age 40 is leaving his company and has been offered to two options. First, is to take a deferred pension at age 65 equal to 25,000 a year. Second, take the commuted value of the deferred pension. He chooses the second option. What is your estimate of the commuted value that he will receive. (Assume mortality age is 90 and intestinal rate of 5%)

Answer rating: 100% (QA)

To estimate the commuted value of the deferred pension we need to use the present value calculati... View the full answer