Question: Jim, aged 6 2 , was retrenched and has been unemployed for ten months, but is still looking for work. He has $ 6 2

Jim, aged 62, was retrenched and has been unemployed for ten months, but is still
looking for work. He has $620,000 in super and, based on advice received, decides to
purchase a 4-year annuity of $24,000 p.a. payable monthly and indexed at 3% p.a. He
can obtain this at a yield of 5.1% from a commercial provider. How much does Jims
annuity cost to purchase?

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