Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Joetta Hemandez is a single parent with fwo children and earns $46,700 a year. Her employer's group life insuance policy would pay 2.5 fimes her

image text in transcribed
image text in transcribed
image text in transcribed
Joetta Hemandez is a single parent with fwo children and earns $46,700 a year. Her employer's group life insuance policy would pay 2.5 fimes her salary She also has $62.267 saved in a 401(k) plan, $5,189 in mutual funds, and a $3,113 certificate of deposit. She waats to purchaso term lise insurance for i5 years, until her youngest child is self supporting She is not concornod about her outstanding mortgage, as tho children would live with her sister in the event of Joetta's death. Assuming sho can recokvo a 5 percent after-tax, alterinflation retum on insurance proceeds, use the eamings multiple method to calculate her insurance need How much more insurance does Joetta need to buy? What other information would you need to know to use the needs approach to calculate Joetta's insurance coverage? Click on the table icon to viow the PViFA table Assuming she can receive a 5% after tax, aflor inflation roturn on insurance procoeds and using the eamings multiple method, Joetta's insurance need is ? (Round to the nearest dollar) How much moro insurance does Jootta need to buy? What other intormation would you noed to know to use the needs approach to calculate Joestars insurance coverage? (Select the best choice below) A. Joetta needs to buy 5241,950 of insurance. Since Joetta is a slingle parent, some needs included in the needs approach method are not rolevan. To use this method, Joetta would need apecific information on projected amounts for cleanup funds, dobt elmination funds excluding the mortgage, educational expenses lor the chidren. and the avallabilty of Social Security to assist with dependency expenses. Joetar can also consider the eftect of existing assets to reduce the amount of insurance needed B. Joetta needs to buy 5475,450 of insurance. Since Joetta is a single parent, some needs inchided in the needs approach nuethod are not relevant To use this method, Joetha would need specific information on projected amounts for cleanup funds, debt elimination funds exelucing the mortgage educatonal expenses for the children, and the availability of Social Security to assist with dependency expenses Joctta can also consider the effect of existing assets to reduce the amount of insurance needed Data table (Click on the following icon Q in order to copy its contents into a spreadsheet.) Present Value of a Series of Annual Deposits (annuity), Present-Value Interest Factor of an Annuity

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Cryptocurrency And Public Policy

Authors: Donavon Johnson

1st Edition

1032311231, 978-1032311234

More Books

Students also viewed these Finance questions

Question

Understand the characteristics of language.

Answered: 1 week ago

Question

Find the derivative of y= cos cos (x + 2x)

Answered: 1 week ago