FN310 Homework 1 You are the beneficiary of a life insurance policy. The insurance company informs you that you have two options for receiving the insurance proceeds. You can receive a lump sum of $50,000 today or receive payments of S641 6. a month for ten years. You can earn 6.5% on your money, which option should eu take and why? A. You should accept the payments because they are worth $56,451.91 today. 8. You should accept the payments because they are worth 556,523.74 today. C. You should accept the payments because they are worth $56,737.08 today D. You should accept the $50,000 because the payments are only worth $47,757.69 today E. You should accept the $50,000 because the payments are only worth $47,808.17 today 7. You borrow S 149,000 to buy a house. The mortgage rate is 7S% and the loan penod is 30 years. Payments are made monthly. If you pay for the house according to the loan agreement, how much total interest will you pay? A. $138,086 8. $218,161 C$226,059 D. $287,086 E. $375,059 8. You retire at age 60 and expect to live another 27 years. On the day you retire, you have $464,900 in your retirement savings account. You are conservative and expect to earn 45% on your money during your retirement. How much can you withdraw from your retirement savings each month if you plan to die on the day you spend your last penny? A. $2,001.96 B. $2,092.05 C. $2,398.17 D. $2,472.00 E. $2,481.27 9, The McDonald Group purchased a piece of property for S1.2 million. It paid a down payment of 25% in cash and financed the balance. The loan terms require monthly payments for 15 years at an annual percentage rate of 7.75% compounded monthly. What is the amount of each mortgage payment? A. $7,440.01 B. $7,978.26 C. $8,036.25 D. $8,399.18 E. $8,471.48 10. You are buying a previously owned car today at a price of $8,125. You are paying $600 down in cash and financing the balance for 36 months at 7.9 percent. What is the amount of each loan payment? A. $198.64 B. $199.9 C. $202.02 D. $214.78 E.$235.46