Question

Tomio, age 28, takes out $50,000 of straight-life insurance. His annual premium is $418.20. Using the tables found in the textbook, determine the cash value of his policy at the end of 20 years.

A. $26,500
B. $30,000
C. $13,250
D. $26,000

Answer 1

C. 13250

Explanation:

Answer 2

Tomio, age 28, takes out $50,000 of straight-life insurance. His annual premium is $418.20. Using the tables found in the textbook, determine the cash value of his policy at the end of 20 years.

A. $26,500
B. $30,000
C. $13,250
D. $26,000

50,000/1,000 = 50
265*50 = $13,250

So the cash value of this policy is $13,250

The correct answer is:
C. $13,250