A person aged 35 has just taken out a home mortgage loan where he will pay...
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A person aged 35 has just taken out a home mortgage loan where he will pay $18,000 at the end of each year for 20 years. He was also required to purchase a life insurance policy that will pay any remaining payments should he die within the 20-year period. (a) (1 point) If the person dies in the first year, how much is the PV of the death benefit? Page 2 (b) (3 points) Calculate the expected present value of this life insurance policy. A person aged 35 has just taken out a home mortgage loan where he will pay $18,000 at the end of each year for 20 years. He was also required to purchase a life insurance policy that will pay any remaining payments should he die within the 20-year period. (a) (1 point) If the person dies in the first year, how much is the PV of the death benefit? Page 2 (b) (3 points) Calculate the expected present value of this life insurance policy.
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Related Book For
Financial Algebra advanced algebra with financial applications
ISBN: 978-0538449670
1st edition
Authors: Robert K. Gerver
Posted Date:
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