CASE $1$: MR OTHON JACKSON

Mr Othon Jackson has been approached by three Financial Brokers from different

entities. All have offered him a $9-$year annuity for an initial purchase price of R$33700$ however the terms attached to each annuity $($Annuity A$,$ Annuity B and Annuity C$)$ are different.

Annuity A offers an interest rate of $12\mathrm{.}4\%$ compounded annually and quarterly

payments of R$1980.$

Annuity B offers $10\mathrm{.}95\%$ interest semi$-$annually compounded and annual payments of R$2350$ made in advance.

Annuity C offers $11\mathrm{.}4\%$ interest monthly compounding and monthly payments of

R$1050$ made in advance. Refer to CASE $1$: MR OTHON JACKSON. Assist Mr Othon Jackson by

calculating the current worth of Annuity A$,$ Annuity B and Annuity C$,$

respectively.

Supplement your assistance by concluding whether or not Mr Othon Jackson

should pursue each annuity and which annuity should ultimately be purchased.

Round to two decimals where required.

$(24$ marks$)$