Nicki Johnson, a sophomore mechanical engineering student, received a call from an insurance agent who believes that Nicki is an older woman who is ready to retire from teaching. He talks to her about several annuities that she could buy that would guarantee her a fixed annual income. The annuities are as follows:

Nicki could earn 11 percent on her money by placing it in a savings account. Alternatively, she could place it in any of the above annuities. Which annuities in the table above, if any, will earn Nicki a higher return than investing in the savings account earning 11percent?

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Purchase Price of the Annuity 50,000 60,000 70,000 Amount of Money Recelved Per Year Duration of the Annulty (Years) 12 Annulty $8,500 $7,000 $8,000 25 20