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Mark has the following information on two life insurance policies he owns: one is a Whole life policy, and the other is a Term life
Mark has the following information on two life insurance policies he owns: one is a Whole life policy, and the other is a Term life policy. Guaranteed Term Premium Guaranteed Death Projected Benefit Projected Cash Value Contract Premium Dividend $2,300 $200,000 0 0 $325 $2,300 0 0 $330 $2,300 0 0 $335 $2,300 0 $3,500 $340 $2,300 $250 $6,000 $355 $2,300 $400 $9,000 $370 $2,300 $600 $12,000 $390 $2,300 $750 $15,000 $400 $2,300 $900 $18,000 $410 $2,300 $1,000 $24,000 $430 Find the return on the Whole life insurance policy when the cost of the Term life is included. Assume in year 10, for the Cash Flow calculation, that the Whole life policy is cashed out. Additionally, which policy should Mark select if he could invest the difference between the Term and Whole life policies premiums at 9 percent? Explain your reasoning. Mark has the following information on two life insurance policies he owns: one is a Whole life policy, and the other is a Term life policy. Guaranteed Term Premium Guaranteed Death Projected Benefit Projected Cash Value Contract Premium Dividend $2,300 $200,000 0 0 $325 $2,300 0 0 $330 $2,300 0 0 $335 $2,300 0 $3,500 $340 $2,300 $250 $6,000 $355 $2,300 $400 $9,000 $370 $2,300 $600 $12,000 $390 $2,300 $750 $15,000 $400 $2,300 $900 $18,000 $410 $2,300 $1,000 $24,000 $430 Find the return on the Whole life insurance policy when the cost of the Term life is included. Assume in year 10, for the Cash Flow calculation, that the Whole life policy is cashed out. Additionally, which policy should Mark select if he could invest the difference between the Term and Whole life policies premiums at 9 percent? Explain your reasoning
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