Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please answer question 12 thank you Done 2 of 2 0124 12 ect ofIn lation on a Life Insurance Policy. Allen has purchased a whole

Please answer question 12 thank you image text in transcribed
Done 2 of 2 0124 12 ect ofIn lation on a Life Insurance Policy. Allen has purchased a whole life policy with a death benefit of Calculating the E 150,000. Assuming that he dies in 8 years and the average inflation has been 2 percent, what is the value of the purchasing power of the proceeds? 012 3, Determining the Cost of Insurance. Suppose you are 45 and have a S 10,000 face amount 15-year limited-payment, part cipa ing policy (dividends will be used to build up the cash value of the policy). Your annual premium is $350. The cash value of the policy is expected to be $4,000 in 15 years. Using time value of money and assuming you could invest your money elsewhere for a 7 percent annual yield, calculate the net cost of insurance

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

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

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

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

Get Started

Students also viewed these Finance questions