You Just Inherited Some Money,and a Broker Offers to Sell

question 93

Multiple Choice

You just inherited some money,and a broker offers to sell you an annuity that pays $18,200 at the end of each year for 20 years.You could earn 5% on your money in other investments with equal risk.What is the most you should pay for the annuity?

• A) $251,761.57
• B) $269,906.55
• C) $226,812.23
• D) $190,522.27
• E) $222,275.98

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Definitions:

Amygdala

A part of the brain involved in processing emotions, including fear, anxiety, and aggression.

Anti-Depressant Medication

Anti-Depressant Medication includes drugs prescribed to treat depressive disorders, working by altering chemicals in the brain to improve mood and cognitive function.

Placebo

A substance that looks and feels like the substance being tested in an experiment, but does not contain the active ingredient.