You have a chance to buy an annuity that pays $3,300 at the beginning of each...

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You have a chance to buy an annuity that pays $3,300 at the beginning of each...

You have a chance to buy an annuity that pays $3,300 at the beginning of each year for 3 years. You could earn 5.5% on your money in other investments with equal risk. What is the most you should pay for the annuity?

	a.	$9,392.86
	b.	$7,420.36
	c.	$7,138.57
	d.	$10,426.07
	e.	$10,801.78

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Answer 1

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3300 3300 3300 نيا Present value + 3300 = 3300 + 3300 1.0552 160551 = 3300 + 3127.96 + 2964.89 = $9392.86 The most that we sh

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