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Big Bucks offers its customers to invest their money in exchange for cash payments that take the form of a 6-year annuity. Customers who buy
Big Bucks offers its customers to invest their money in exchange for cash payments that take the form of a 6-year annuity. Customers who buy such annuity would in return receive twelve semiannual cash payments in the amount of $5,400 each. This annuity investment would take place in 11 years, and the first cash payment would be received in 11.5 years. a. The annuity's rate of return is 7 percent, compounded monthly. If you buy such annuity five years from today, at that time its value will equal $ (Do not round intermediate calculations. Round your final answer to 2 decimal places, e.g., 32.16.) b. Assume instead that the annuity's rate of return is 7 percent, compounded monthly. If you buy such annuity three years from today its value at that time will equal $. (Do not round intermediate calculations. Round your final answer to 2 decimal places, e.g., 32.16.) c. If the annuity's rate of return is 7 percent, compounded monthly, then today you would need to pay $ for such annuity investment. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) a. Value of the annuity b. Value of the annuity C. Value of the annuity
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