An insurance company has three investments available.Each costing $200,000:
(I) A Canadian government bonds to obtain a yield of j₂ = 6%.
(II) A perpetuity paying $5900 at the end of each half year.
(III) An ordinary annuity paying $13,200 every 6 months for 10 years.
Using j₂ = 6% as the cost of capital,rank the above investments from highest net present value to lowest net present value.

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The Answer of An insurance company has three investments available.Each costing $200,000: (I)A Canadian government bonds to obtain a yield of j₂ = 6%. (II)A perpetuity paying $5900 at the end of each half year. (III)An ordinary annuity paying $13,200 every 6 months for 10 years. Using j₂ = 6% as the cost of capital,rank the above investments from highest net present value to lowest net present value.

An Insurance Company Has Three Investments Available