Joseph, who just had his 55th birthday, has the following probability of death in each year:...

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Joseph, who just had his 55th birthday, has the following probability of death in each year: Age Probability of death 55-56 56-57 57-58 58-59 59-60 0.025 0.026 0.027 0.028 0.029 0.025 60+ Given an annual interest rate of 5%, calculate the premium of a three-year endowment policy with a face amount equal to $500,000 for Joseph. Suppose that Joseph just reached age 60 and wanted to purchase a life immediate annuity that pays him $480,000 each year, starting from his 61st birthday until his death. Given an annual interest rate of 5%, what amount should he pay now to purchase the annuity? Joseph, who just had his 55th birthday, has the following probability of death in each year: Age Probability of death 55-56 56-57 57-58 58-59 59-60 0.025 0.026 0.027 0.028 0.029 0.025 60+ Given an annual interest rate of 5%, calculate the premium of a three-year endowment policy with a face amount equal to $500,000 for Joseph. Suppose that Joseph just reached age 60 and wanted to purchase a life immediate annuity that pays him $480,000 each year, starting from his 61st birthday until his death. Given an annual interest rate of 5%, what amount should he pay now to purchase the annuity?

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To calculate the premium of a threeyear endowment policy for Joseph we need to consider the probability of his survival for each of the three years and discount the face amount of the policy using the ... View the full answer