An Uncle of Yours Who Is About to Retire Wants

question 140

Multiple Choice

An uncle of yours who is about to retire wants to sell some of his stock and buy an annuity that will provide him with income of $50,000 per year for 30 years, beginning a year from today.The going rate on such annuities is 7.25%.How much would it cost him to buy such an annuity today?

• A) $574,924
• B) $605,183
• C) $635,442
• D) $667,214
• E) $700,575

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Definitions:

Standard Error

A statistical term that describes the standard deviation of the sampling distribution of a statistic, commonly used to measure the accuracy of sample means.

Snowball Sampling

A sampling technique where current study participants recruit future participants from among their acquaintances.

Stratified Random Sampling

A sampling method that divides the population into subgroups or strata, and random samples are taken from each stratum to ensure representation.

Subgroups

Divisions or smaller groups formed within a larger group, often based on specific characteristics or criteria.