Assume That You Own an Annuity That Will Pay You

question 121

Multiple Choice

Assume that you own an annuity that will pay you $15,000 per year for 12 years, with the first payment being made today.You need money today to open a new restaurant, and your uncle offers to give you $120,000 for the annuity.If you sell it, what rate of return would your uncle earn on his investment?

• A) 6.85%
• B) 7.21%
• C) 7.59%
• D) 7.99%
• E) 8.41%

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Definitions:

Field Selector

A user interface element that enables the user to choose specific fields or data elements for display or manipulation.

Field Bar

The Field Bar is a user interface element in software applications where specific fields' data or options can be entered or displayed; commonly seen in databases or form-based interfaces.

Add New

A command or button in software applications used to create a new entity, like a document, database record, or item in a list.

New (Blank)

A state or condition of being empty or untouched, starting from the beginning, often referring to a document or file with no content.