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Pete invested $50,000 in a variable annuity 15 years ago when he was 52. The contract is now valued at $180,000, and Pete elects to

Pete invested $50,000 in a variable annuity 15 years ago when he was 52. The contract is now valued at $180,000, and Pete elects to annuitize under a straight life option. The AIR is 5 percent, and the annuity purchase rate is $6.50. What is Pete's initial income payment?

a. $900

b. $1,170

c. $2,500

d. $3,250

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