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A 25-year mortgage of 100,000 issued to (40) is to be repaid with equal annual...

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Accounting

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A 25-year mortgage of 100,000 issued to (40) is to be repaid with equal annual payments at the end of each year. A 25-year term insurance has a death benefit which will pay off the mortgage at the end of the year of death including the payment then due. You are given (i) i = 0.05 (ii) 2 40:25] = 14 (iii) 25940 = 0.2 Calculate the level annual benefit premium for this term insurance. A. 405 B. 414 C. 435 D. 528 E. 694

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