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Suppose a 65-year-old person wants to purchase an annuity from an insurance company that would pay...

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Finance

Suppose a 65-year-old person wants to purchase an annuity froman insurance company that would pay $21,600 per year until the endof that person’s life. The insurance company expects this person tolive for 15 more years and would be willing to pay 8 percent on theannuity. How much should the insurance company ask this person topay for the annuity?

$175,131.62

$188,964.27

$154,356.29

$184,884.74

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