Question $13($Bonus$)($Mandatory$)(2$ points$)$

Evelyn, who is married and the mother of two, is $29$ years old and expects to work

until age $75.$ She earns $$125,000$ per year. Evelyn expects inflation to be $3\%$ over her

working life, and the appropriate risk$-$free discount rate is $4\%.$ Her personal

consumption is equal to $32\%$ of her after$-$tax earnings, and her combined federal and

state marginal tax bracket is $22\%.$ What is the amount of life insurance necessary for

Evelyn using the Human Life Value method? Show your calculation steps.