Calculate the Difference in the Current Economic Values of the Following

question 70

Multiple Choice

Calculate the difference in the current economic values of the following two annuities: Annuity "A": Payments of $50 made at the end of each month for the next 30 years, using 9.6% compounded monthly. Annuity "B": Payments of $600 made at the end of every year for the next 50 years using 9.6% compounded annually.

• A) Annuity "A" is worth $291 more than Annuity "B."
• B) Annuity "A" is worth $103 more than Annuity "B."
• C) The current economic values are within $50 of each other.
• D) Annuity "B" is worth $103 more than Annuity "A."
• E) Annuity "B" is worth $291 more than Annuity "A."

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Definitions:

Just Law

A legal principle or legislation that is regarded as fair, morally right, and in accordance with ethical standards.

Equitable Remedy

A corrective action ordered by a court that involves doing or refraining from doing something, as opposed to paying damages, to address a legal wrong or a breach of contract.

Equity Courts

Courts that have jurisdiction over cases involving remedies other than monetary rewards, such as injunctions or specific performance, based on fairness.

Injunction

An equitable remedy whereby the defendant is ordered to perform certain acts or to desist from certain acts.