Professor’s Annuity Corp offers a lifetime annuity to retiring professors. For a payment of $80000 at...
Professor’s Annuity Corp offers a lifetime annuity to
retiring professors. For a payment of $80000 at age 65, the firm
will pay the retiring professor $600 a month until death.
monthly rate on annuity?
Homework Answers
As the term of annuity is not given, it can be taken as a perpetuity.
The monthly rate = 600/80000 = 0.0075 = 0.75% per month [9.00% per annum]
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