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After Retirement, Kelly's Company Offers Her Two Options for Receiving $700\$ 700

Question 58

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After retirement, Kelly's company offers her two options for receiving her retirement pension. According the the first plan, she will receive monthly payments from a variable annuity that initially pays $700\$ 700 per month then decreases each month at a rate of $25\$ 25 per month per year. Optionally, she may choose a plan that pays her a fixed amount of $500\$ 500 per month for the rest of her life. The monthly payments for the two plans are illustrated in the graph below. After how many years does the variable plan pay less per month than the fixed plan?
 After retirement, Kelly's company offers her two options for receiving her retirement pension. According the the first plan, she will receive monthly payments from a variable annuity that initially pays  \$ 700  per month then decreases each month at a rate of  \$ 25  per month per year. Optionally, she may choose a plan that pays her a fixed amount of  \$ 500  per month for the rest of her life. The monthly payments for the two plans are illustrated in the graph below. After how many years does the variable plan pay less per month than the fixed plan?   A)  Up to 8 years B)  8 years C)  9 years D)  The variable plan always pays less.


A) Up to 8 years
B) 8 years
C) 9 years
D) The variable plan always pays less.

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