Question: PLEASE ROUND ALL ANSWERS TO TWO DECIMAL POINTS Question 20 1 pts 20. You purchase an annuity paying $120 monthly for 20 years at a

PLEASE ROUND ALL ANSWERS TO TWO DECIMAL POINTS

Question 20 1 pts 20. You purchase an annuity paying $120 monthly for 20 years at a discount rate of 7.4%. What was the amount of your investment? Question 21 1 pts 21. After ten years you need cash and decide to sell the annuity to your sister-in- law for a lump sum. The current rate of return on investment instruments with similar risk is 6%. What would be a fair price? Question 22 1 pts 22. You have $8000 to invest for one year and must choose between two investment opportunities. The first pays 6%, compounded semi-annually. The second pays 5.7% interest, compounded quarterly. Assuming equal risk, which investment is the better opportunity? First Second

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