Elvira is considering buying a 20-year ordinary annuity to provide her with retirement income.The annuity will make annual payments of $25,000.If her opportunity cost is 7%, what is the maximum Elvira should pay for the annuity?
A)$1,096,629
B)$1,024,887
C)$283,390
D)$264,850

Question

Quizplus · Accepted Answer

The Answer of Elvira is considering buying a 20-year ordinary annuity to provide her with retirement income.The annuity will make annual payments of $25,000.If her opportunity cost is 7%, what is the maximum Elvira should pay for the annuity?
A)$1,096,629
B)$1,024,887
C)$283,390
D)$264,850

Elvira Is Considering Buying a 20-Year Ordinary Annuity to Provide