Charles Is the Sole Beneficiary of His Late Uncle's Life

question 134

Multiple Choice

Charles is the sole beneficiary of his late uncle's life insurance policy.The face value of the policy is $785,000.Charles has decided to accept annual annuity payments of $95,000.The interest rate on the policy is 5%.How many annual payments will Charles receive from this policy?

• A)7.08 years worth of payments
• B)8.26 years worth of payments
• C)10.92 years worth of payments
• D)None of the above

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Definitions:

One-Time Game

A strategic interaction where players make decisions once without the expectation of future interactions.

Positive-Sum Game

A situation in economic, political, or cooperative contexts where all participants can gain or benefit in some way.

Zero-Sum Game

A situation in game theory where the gain of one participant is exactly balanced by the loss of another participant.

Credible Threat

A promise of negative consequences that is believable and likely to influence behavior in strategic situations.