You are married. You have two children. You children are ages 5 and 10. You are
ID: 2648113 • Letter: Y
Question
You are married. You have two children. You children are ages 5 and 10. You are the only person in the family who is earning an income. Your annual expenses are $68,000. You would like to buy term life insurance for a term of 20 years with a death benefit equal to the present value of $68,000. The interest rate you use to make the present value calculation is 3% per year. How much insurance must you buy?
between $800,000 and $1,200,000
between $100,000 and 200,000
between $400,000 and $800,000
between $200,000 and $400,000
between $800,000 and $1,200,000
between $100,000 and 200,000
between $400,000 and $800,000
between $200,000 and $400,000
Explanation / Answer
Answer:
between $200,000 and $400,000
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