Sam Was Injured in an Accident,and the Insurance Company Has

question 96

Multiple Choice

Sam was injured in an accident,and the insurance company has offered him the choice of $25,000 per year for 15 years,with the first payment being made today,or a lump sum.If a fair return is 7.5%,how large must the lump sum be to leave him as well off financially as with the annuity?

• A)$225,367
• B)$237,229
• C)$249,090
• D)$261,545
• E)$274,622

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Definitions:

AOD Use

The consumption of alcohol and other drugs; often discussed in contexts of abuse, dependency, and treatment.

Intrapersonal Factors

Pertains to the internal or personal elements that influence an individual's thoughts, feelings, and behaviors.

Interpersonal Factors

Elements that affect social interaction and relationships between individuals, including communication and social skills.

Relapse

Returning to a previous state of illness or deteriorating behavior after a period of improvement or recovery, especially in the context of addiction.