1. Define the various types of life insurance.

2. How are premiums and dividends taxed? How are death benefits taxed?

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29

Aug1. Define the various types of life insurance.

2. How are premiums and dividends taxed? How are death benefits taxed?

29

Aug
Categories: General Questions

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Which table would you use to determine how much you would need to have deposited three years ago at 10% compounded annually in order to have $1,000 today?

A. Future value of an ordinary annuity of 1

B. Future value of 1 or present value of 1

C. Future value of an annuity due of 1

D. Present value of an ordinary annuity of 1

29

Aug
Categories: General Questions

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1. The first deposit is received on December 31, 2011, and the interest is compounded annually.

2. The first deposit is received on December 31, 2010, and the interest is compounded annually.

3. The first deposit is received on December 31, 2010, and the interest is compounded annually.

4. The first deposit is received on December 31, 2010, interest is compounded annually, and interest earned is withdrawn at the end of each year.

29

AugAnswer each of the following independent questions

1. Alex Meir recently won a lottery and has the option of receiving one of the following three prizes.

(1) 64,000 cash immediately,

(2) $20,000 cash immediately and six-period annuity of $8,000 beginning one year from today,

(3) a six period annuity of $8,000 beginning one year from today, or

(4) a six year period annuity of $13,000 beginning one year from today.

Assuming an interest rate of 6%, which option would Alec choose?

2. The Weiner Corporation wants to accumulate a sum of money to repay certain debts due on December 31, 2020. Weiner will make annual deposits of $100,000 into a special bank account at the end of each of 10 years beginning December 31, 2011. Assuming that the banks pays 7% interest compounded annually, on December 30, 2014 what will be the fund balance after the last payment?

29

Aug29

Aug
Categories: General Questions

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What is the present value of the following investment opportunity. You invest $10,000 now and another $10,000 in one year. In return you receive $23,000 in two years. Other opportunities available with similar risk yield about 12%.

$9,406.60

$593.40

($593.40)

$8,929

29

Aug
Categories: General Questions

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Which of the following cash flows is equivalent to receiving $125.00 today assuming a 9% annual discount rate?

$192.33 five years from today

$229.87 seven year from today

$163.12 three years from today

$312.67 ten years from today