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Immediate fixed annuity model - Dr. K's mother is concerned about running out of money after reading an article on immediate fixed annuities offered by

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Immediate fixed annuity model - Dr. K's mother is concerned about running out of money after reading an article on immediate fixed annuities offered by insurance companies. Thus, she wants you to evaluate some immediate fixed annuities. Read the "Immediate Fixed Income Annuities" information at the end of part 1. Then use the fixed income annuity factors at the end of the Part I to answer the following questions. For a hint on 1.77% calculation, see page 4 of the "Primer on how to read Treasury bond quotes" on Canvas. Complete the following tables. Immediate fixed annuity for a $500,000 policy for a 65-year old woman. Years Certain (factor) $2,475 Monthly income Not 1.77% Annualized rate of retum if annuity paid for years certain. This is a time value of money problem where you need to solve for t/Y. applicable Which years certain (0, 10, 20) would you recommend to her? Based on your recommended years certain, what would be the monthly income for her? Based on your recommended years certain, what would be her annual income ... just multiply monthly income by 12? Based on your recommended years certain, what would be the year one annual withdrawal rate (to two decimal places)? Immediate fixed annuity model - Dr. K's mother is concerned about running out of money after reading an article on immediate fixed annuities offered by insurance companies. Thus, she wants you to evaluate some immediate fixed annuities. Read the "Immediate Fixed Income Annuities" information at the end of part 1. Then use the fixed income annuity factors at the end of the Part I to answer the following questions. For a hint on 1.77% calculation, see page 4 of the "Primer on how to read Treasury bond quotes" on Canvas. Complete the following tables. Immediate fixed annuity for a $500,000 policy for a 65-year old woman. Years Certain (factor) $2,475 Monthly income Not 1.77% Annualized rate of retum if annuity paid for years certain. This is a time value of money problem where you need to solve for t/Y. applicable Which years certain (0, 10, 20) would you recommend to her? Based on your recommended years certain, what would be the monthly income for her? Based on your recommended years certain, what would be her annual income ... just multiply monthly income by 12? Based on your recommended years certain, what would be the year one annual withdrawal rate (to two decimal places)

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