Step 3: Evaluate Annuities

As McCormick & Company reviews its capital in preparation for constructing the factory, it has asked MCS to help with the process of selecting the best retirement options for their employees. To help McCormick make the best decision based on our recommendations, you will need to understand several concepts:

• annuities
• stocks
• bonds
• standard deviation
• internal rate of return
• risk-free rate of return
• treasury bill rate

You will also apply what you learned about present value and future value.

Working with the same Project 4 Excel Workbook you will use in Steps 1 and 2, complete the Annuities worksheet. The worksheet poses questions about the retirement annuities, US treasury bond rates for the employees portfolios managed by a retirement fund company, and annuities for employee's personal investments. This information will clarify the best choice of retirement plan for McCormick employees.

When you have answered the questions provided, submit the Project 4 Excel Workbook to the submission folder in the final step of this project. Then continue to Step 4, where you will discuss risk and returns with your colleagues.