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9. (10 points) John buys a 20 year annuity-immediate with quarterly payments: (i) year 1 payments are 1 per quarter, (ii) year 2 payments are

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9. (10 points) John buys a 20 year annuity-immediate with quarterly payments: (i) year 1 payments are 1 per quarter, (ii) year 2 payments are 2 per quarter, (iii) year 3 payments are 3 per quarter, (iv) and so on. Calculate the purchase price if the effective annual interest rate is 4%. A. 508 B. 513 C. 518 D. 523 E. 528 9. (10 points) John buys a 20 year annuity-immediate with quarterly payments: (i) year 1 payments are 1 per quarter, (ii) year 2 payments are 2 per quarter, (iii) year 3 payments are 3 per quarter, (iv) and so on. Calculate the purchase price if the effective annual interest rate is 4%. A. 508 B. 513 C. 518 D. 523 E. 528

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