Question
In: Finance
You are the beneficiary of a life insurance policy. The insurance company informs you that you...
You are the beneficiary of a life insurance policy. The insurance company informs you that you have two options for receiving the insurance proceeds. You can receive a sum payment of 50,000$ today pr receive payments of 641$ a month for 10 years. You can earn 6.5% on your money. Which option should you take if you are most concerned about the value today? How much will you save by taking it? Show work.
Solutions
jeff jeffy answered 2 years agoRelated Solutions
You are the beneficiary of a life insurance policy. The insurance company informs you that you...
You are the beneficiary of a life insurance policy. The
insurance company informs you that you have two options for
receiving the insurance proceeds. You can receive a lump sum of
$60,000 day or receive payments of $641 a month for ten years. You
can earn 6.5% on your money. Which.ontion should you take and why?
(Show all calculations for full credit.
You are the beneficiary of a life insurance policy. The insurance company informs you that you...
You are the beneficiary of a life insurance policy. The
insurance company informs you that you have two options for
receiving the insurance proceeds. You can receive a lump sum of
$200,000 today or receive payments of $1,400 a month for 20 years.
You can earn 10 percent on your money. Which option should you take
and why?
You are the beneficiary of a life insurance policy. The insurance company informs you that you...
You are the beneficiary of a life insurance policy. The
insurance company informs you that you have two options for
receiving the insurance proceeds. You can receive a lump sum of
$200,000 today or receive payments of $1,400 a month for 20 years.
You can earn 6 percent on your money. Which option should you take
and why?
4. You are the beneficiary of a life insurance policy. The insurance company informs you that...
4. You are the beneficiary of a life insurance policy. The
insurance company informs you that you have two options for
receiving the insurance proceeds. You can receive a lump sum
of$125,000 today or receive payments of $4,000 a month for forty
months. You can earn 12 percent per year on your money.
Which option would you take?
a) Accept the payments because they are worth $126,570
today.
b) Accept the payments because they are worth $131,338
today.
c) Accept...
John is the beneficiary of a life insurance policy. Theinsurance company informs John that he...
John is the beneficiary of a life insurance policy. The
insurance company informs John that he has two options for
receiving the insurance proceeds. He can retrieve a lump sum of
$125,000 today or receive payments of $4,000 a month for forty
months. He can earn 12% per year on his money. Which option would
you take ?
You are the beneficiary of a life insurance policy. The insurance company offers two options for...
You are the beneficiary of a life insurance policy. The
insurance company offers two options for receiving the proceeds: a
lump sum of $50,000 today or payments of $550 a month for ten
years. If you can earn 6%, compounded monthly, which option should
you take and why?
a. Accept the lump sum because the payments are only worth
$49,540.40 today.
b. Accept the monthly payments because they are worth $51,523.74
today.
c. Accept the payments because they are worth...
As the beneficiary of a life insurance policy, you have twooptions for receiving the insurance...
As the beneficiary of a life insurance policy, you have two
options for receiving the insurance proceeds. You can receive a
lump sum of $255,000 today or receive payments of $2,000 a month
for 18 years. If you can earn 6 percent (APR) on your money, which
option should you take and why?A.You should accept the payments because they are worth $263,796
today.B.You should accept the payments because they are worth $259,111
today.C.You should accept the payments because they are...
The beneficiary of a life insurance policy is generally: a. a creditor beneficiary. b. an incidental...
The beneficiary of a life insurance policy is generally: a. a
creditor beneficiary. b. an incidental beneficiary. c. a donee
beneficiary. d. a debtor beneficiary. Despite the general rule
allowing minors to disaffirm their contracts, some states have
passed special statutes that make minors liable for which of the
following? a. Educational loans. b. Medical and dental expenses. c.
Insurance policies. d. All of the above. Which of the following
contracts would be governed by the Uniform Commercial Code? a....
As the beneficiary of a life insurance policy, you have two options for receiving the insurance...
As the beneficiary of a life insurance policy, you have two
options for receiving the insurance proceeds. You can receive a
lump sum of $200,000 today or receive payments of $1,400 a month
for 20 years. If you can earn 6 percent on your money, which option
should you take and why?
A life insurance trust is often named the beneficiary of a life insurance policy it holds...
A life insurance trust is often named the beneficiary of a life
insurance policy it holds for which of the following reasons?
a. It can provide greater flexibility than is available under
insurance settlement options
b. It can eliminate a second estate tax upon the death of the
beneficiaries.
c. It can incorporate special limitations and restrictions on
the funds designed to be paid to specific beneficiaries.
d. All of the above
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