An insurance policy offers you the option of being paid 750

Last updated: 10/15/2023

An insurance policy offers you the option of being paid 750 per month for 20 years or a lump sum of 100 000 Assume that the current rate of return is 4 5 compounded monthly and you expect to live for 20 years Identify the following for the annuity monthly payment option where m is the periodic payment in dollars r is the annual interest rate as a decimal n is the number of payments per year and t is the time in years m r n t Determine the present value of the annuity Round your answer to the nearest cent Which has more value O the annuity O the lump sum payment