document.write( "Question 1183073: Mr Hammond is 45 years of age and has a life expectancy of 10 more years. He
\n" ); document.write( "wishes to invest $20,000 in an annuity that will make a level payment at the end of
\n" ); document.write( "each year until his death. If the interest rate is 8%, what income can Mr Hammond
\n" ); document.write( "expect to receive each year? \n" ); document.write( "

Algebra.Com's Answer #813232 by MathTherapy(10552) $\"\"$ $\"About$

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Mr Hammond is 45 years of age and has a life expectancy of 10 more years. He
\n" ); document.write( "wishes to invest $20,000 in an annuity that will make a level payment at the end of
\n" ); document.write( "each year until his death. If the interest rate is 8%, what income can Mr Hammond
\n" ); document.write( "expect to receive each year?
\n" ); document.write( "


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document.write( "When either of the 3 is applied, he should be expecting annual payments of , at the END of each year, for  10 years.
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document.write( "So, the formula for the present value of an ORDINARY ANNUITY was used. I may be WRONG. Tutor IKLEYN's answer is more practical though,
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document.write( "since she used the formula for payments/payouts at the beginning of the year (ANNUITY DUE) - which is when payments are normally 
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document.write( "made - as opposed to the end. To be 100% certain though, the problem needs to state when exactly he's expecting these payouts.
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document.write( "I RETRACT
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document.write( "I actually read the problem AGAIN, something I didn't do before, and it clearly states that he wishes to get the annual payments 
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document.write( "at the END of the year, so , at the END of each year, for  10 years is what he should expect. \n" );
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