You are considering creating an annuity and you want to compare your options. Calculate the following...

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You are considering creating an annuity and you want to compare your options. Calculate the following to determine which would be best. 5. An annuity of $500 per year compounded continuously earning 8% for 6 years 6. An annuity of $650 per year compounded continuously earning 8% for 4 years 7. An annuity of $500 per year compounded continuously eaming 5% for 10 years 8. An annuity of $650 per year compounded continuously earning 7% for 6 years 9. Which of the options in #5-8 will earn you the most money? 10. Comparing #5 and #6, is it better to invest less money for a longer period of time or more money for less time (given they have the same interest rate)? Explain your reasoning. You are considering creating an annuity and you want to compare your options. Calculate the following to determine which would be best. 5. An annuity of $500 per year compounded continuously earning 8% for 6 years 6. An annuity of $650 per year compounded continuously earning 8% for 4 years 7. An annuity of $500 per year compounded continuously eaming 5% for 10 years 8. An annuity of $650 per year compounded continuously earning 7% for 6 years 9. Which of the options in #5-8 will earn you the most money? 10. Comparing #5 and #6, is it better to invest less money for a longer period of time or more money for less time (given they have the same interest rate)? Explain your reasoning.

Answer rating: 100% (QA)

To determine which annuity option would be best and calculate the earnings we can use the formula for the future value of a continuous annuity FV P er... View the full answer