Samuel Just Inherited an Annuity

question 53

Multiple Choice

Samuel just inherited an annuity. He will receive six equal annual payments of $18,000, beginning today. Assuming a 10% interest rate compounded annually, the present value today of all receipts is

• A) $64,886.
• B) $78,395.
• C) $86,234.
• D) $75,058.

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Definitions:

Structural

Pertaining to the physical or logical arrangement of a system's parts.

Preoperational Stage

The second stage in Piaget's theory of cognitive development, typically occurring between ages 2 and 7, characterized by the development of language and the ability to think symbolically, yet struggling with logic or understanding the viewpoint of others.

18 Months

A reference to a specific age or time period, often significant in developmental psychology for milestones in infants.

Mental Structures

Internal cognitive constructs that represent the mind's perceptions, thoughts, and ideas; they shape how information is interpreted and stored.