Suppose you set aside $1 million for an immediate annuity. (i.e., you give $1 million no to an insurance company) with the following terms: you will get monthly income starting from next month, the monthly income is $4,000 paid at the end of each month until death. suppose you expect to live for an additional 20 years. 

How many years will you need to live to break even (i.e., the number of years so the present value of the annuity payment equals $1 million)

Answer rating: 100% (QA)

To determine the number of years you would need to live to break even on the immediate annuity we ca... View the full answer