Jay and Jita have been married for 25 years. Jay is 52 years of age, while Jita is 51 years of age. They want to have enough life insurance so that the life insurance proceeds would provide Jita with an annual before-tax income of $52,000 in current dollars paid at the end of each year for 35 years. At the end of this period, they want to have a capital amount left of $75,000 in current dollars. They would like to use the life insurance proceeds to pay off their mortgage with a balance owing of $125,000 and a line of credit with a balance owing of $45,000. They expect that the net proceeds could cam a before-tax return of 6% and that inflation will be 3%. Then only life insurance is a group policy through Jay's employer with a death benefit of $200,000. Jay plans to continue working until 65 years of age.

How much insurance on bis life would you advise your client to purchase?

(A) $1,130,000

(B) $1,160,000

(C) $1,280,000

(D) $1,320,000