Silva Is Contemplating to Buy a 20 Year Annuity Paying

question 10

Multiple Choice

Silva is contemplating to buy a 20 year annuity paying $2500 at the end of each month. What amount will be required to purchase the annuity, if the annuity provides a return of 6.75% compounded annually?

• A) $334 000
• B) $47 246
• C) $600 000
• D) $37 037
• E) $567 436