Uncle Is About to Retire, and He Wants to Buy

question 43

Multiple Choice

uncle is about to retire, and he wants to buy an annuity that will provide him with $75,000 of income a year for 20 years, with the first payment coming immediately.The going rate on such annuities is 5.25%.How much would it cost him to buy the annuity today?

• A)$825,835
• B)$869,300
• C)$915,052
• D)$963,213
• E)$1,011,374

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Definitions:

Second Continental Congress

A convention of delegates from the Thirteen Colonies which started meeting in the spring of 1775, soon after warfare in the American Revolutionary War had begun.

Continental Army

The revolutionary war army authorized by the Continental Congress in 1775 to fight against British rule, commanded by General George Washington.

Articles of Secession

Documents drafted and ratified by the 11 Confederate states declaring their secession from the United States of America, leading up to the Civil War.