The Maybe Pay Life Insurance Co. is trying to sell you an investment policy that
ID: 2660002 • Letter: T
Question
The Maybe Pay Life Insurance Co. is trying to sell you an investment policy that will pay you and your heirs $40,000 per year forever. If the required return on this investment is 6.30 percent, how much will you pay for the policy? (Round your answer to 2 decimal places. (e.g., 32.16))
The Maybe Pay Life Insurance Co. is trying to sell you an investment policy that will pay you and your heirs $40,000 per year forever. If the required return on this investment is 6.30 percent, how much will you pay for the policy? (Round your answer to 2 decimal places. (e.g., 32.16))
Explanation / Answer
40000/0.063=634920.6
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