How Much Will It Cost to Purchase a 20-Year Indexed

question 96

Multiple Choice

How much will it cost to purchase a 20-year indexed annuity in which the end of quarter payments start at $6,000 and grow by 0.5% every quarter? Assume that the money used to purchase the annuity earns 8% compounded quarterly.

• A) $277,727
• B) $480,000
• C) $316,842
• D) $516,667
• E) $326,744

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