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theory of interest You have started a new fin-tech company where you offer to buy out annuities from potential customers. Suzy requests an offer for
theory of interest You have started a new fin-tech company where you offer to buy out annuities from potential customers. Suzy requests an offer for her annuity that pays $2000 monthly for the next 10 years (the next payment is 1 month from now). Her annuity payments were originally set when the nominal rate compounded monthly was 6%. Interest rates have risen to 9% nominal rate compounded monthly. Your profit requirement is set by increasing the market interest rate by a factor 1.2. What profit do you plan to make on Suzy's annuity? A) $11,492 C$16,519 E) $31,576 B) $13,481 D) $24,684
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