Calculate the following with work shown. a . What is the amount of the annuity purchase required
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Question:
Calculate the following with work shown.
a What is the amount of the annuity purchase required if you wish to receive a fixed payment of $ for years? Assume that the annuity will earn percent per year.
bCalculate the annual cash flows annuity payments from a fixedpayment annuity if the present value of the year annuity is $ million and the annuity earns a guaranteed annual return of percent. The payments are to begin at the end of the current year.
cYou deposit $ annually into a life insurance fund for the next years, at which time you plan to retire. Instead of a lump sum, you wish to receive annuities for the next years. What is the annual payment you expect to receive beginning in year if you assume an interest rate of for the whole time period?
d An insurance companys projected loss ratio is percent and its expense ratio is percent. It estimates that dividends to policyholders will add another What is the minimum yield on investments required in order to maintain a positive operating ratio?
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