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Part $1$

Nicki$$ Johnson, a teacher retiring$$ soon, receives a call from an insurance agent. The agent talks to Nikki about several annuities that she could buy that would guarantee her an annual$($guaranteed$)$ income. The annuities are as follows in the popup$$ window: LOADING....

If Nicki could earn $9$ percent on her money by placing it in a savings$$ account, should she place it instead in any of the$$ annuities? Which$$ ones, if$$ any? Why?

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Part $1$

a$.$ What rate of return could Nicki earn on her money if she place it in annuity A with $$$$8$ comma $000$ payment per year and $15$ years$$ duration?

$$

$9\mathrm{.}00\%($Round to two decimal$$ places.$)$

If Nicki could earn $9$ percent on her money by placing it in a savings$$ account, should she place it instead in annuity$$ A$?($Select the best choice$$ below.$)$

A$.$

No$.$ Nicki should not place her money in annuity A because the expected rate of return on the annuity is smaller than the one on the savings account.

B$.$

Yes. Nicki should place her money in annuity A because the expected rate of return on the annuity is greater than the one on the savings account.

b$.$ What rate of return could Nicki earn on her money if she placed it in annuity annuity B with $$$$9$ comma $000$ payment per year and $10$ years$$ duration?

$$

$9\mathrm{.}00\%($Round to two decimal$$ places.$)$

If Nicki could earn $9$ percent on her money by placing it in a savings$$ account, should she place it instead in annuity$$ B$?($Select the best choice$$ below.$)$

A$.$

Yes. Nicki should place her money in annuity B because the expected rate of return on the annuity is greater than the one on the savings account.

B$.$

No$.$ Nicki should not place her money in annuity B because the expected rate of return on the annuity is smaller than the one on the savings account.

c$.$ What rate of return could Nicki earn on her money if she placed it in annuity annuity C with $$$$8$ comma $500$ payment per year and $22$ years$$ duration?

$$

$8\mathrm{.}00\%($Round to two decimal$$ places.$)$

If Nicki could earn $9$ percent on her money by placing it in a savings$$ account, should she place it instead in annuity$$ C$?($Select the best choice$$ below.$)$

A$.$

No$.$ Nicki should not place her money in annuity C because the expected rate of return on the annuity is smaller than the one on the savings account.

B$.$

Yes. Nicki should place her money in annuity C because the expected rate of return on the annuity is greater than the one on the savings account.