An insurance company sells an annuity to a person whose probability of surviving 1 year is .65,
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An insurance company sells an annuity to a person whose probability of surviving 1 year is .65, of surviving 2 years is .45, and whose probability of surviving 3 years is negligible. If the annuity pays 3000 at the end of each year, and if the company wishes to earn 14%, what is a fair price for this annuity?
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Related Book For 
Theory Of Interest And Life Contingencies With Pension Applications A Problem Solving Approach
ISBN: 978-1566983334
3rd Edition
Authors: Asa Michael M. Parmenter, Ph.d.
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