Bill switched life insurance companies and was able to obtain the same coverage for a savings of $100 per year on premiums. He then invested his savings at 5% per year. How much did he have after 7 years?
A. $814
B. $575
C. $1410
D. $410
E. $579
Future value of annuity=Annuity[(1+rate)^time period-1]/rate
=100[(1.05)^7-1]/0.05
=100*8.14200845
=$814(Approx).
Bill switched life insurance companies and was able to obtain the same coverage for a savings...
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