Exercise


ABy Admin
Nov 18'23

Answer

Solution: D

The given information yields the following amounts of interest paid:

Seth = 5000 ((1+0.12/2)10-1)= 8954.24- 5000 = 3954.24

Janice = 5000(0.06)(10) = 3000.00

Lori = [math]P(10)[/math] - 5000 = 1793.40 where [math]P = \frac{5000}{a_{\overline{10}|6\%}}[/math] = 679.35

The sum is 8747.64.

Copyright 2023 . The Society of Actuaries, Schaumburg, Illinois. Reproduced with permission.

00