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A person aged 30 won a cash for life lottery. The lottery pays out the money as a whole life annuity due with the following
A person aged 30 won a "cash for life lottery. The lottery pays out the money as a whole life annuity due with the following payments: $72,000 annually for the first 15 years (i.e. first 15 payments) $36,000 annually for the next 5 years $54,000 annually thereafter . . a) (4 marks) Using equation of value techniques, set up an equation that could be used to solve for the NSP of this annuity using (i) the blocking method and then (ii) the stacking method (no calculations required for (a)). A person aged 30 won a "cash for life lottery. The lottery pays out the money as a whole life annuity due with the following payments: $72,000 annually for the first 15 years (i.e. first 15 payments) $36,000 annually for the next 5 years $54,000 annually thereafter . . a) (4 marks) Using equation of value techniques, set up an equation that could be used to solve for the NSP of this annuity using (i) the blocking method and then (ii) the stacking method (no calculations required for (a))
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