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Business Mathematics in Canada 4e
Business Mathematics in Canada, 4/e
F. Ernest Jerome
Ordinary Annuities: Future Value and Present Value

Internet Application Problems



1

Most annuities are now sold to retirees who use money accumulated in their RRSPs to purchase Registered Retirement Income Funds (RRIFs) providing a steady stream of income. You can find current rates of return paid on RRIFs and rates may be quoted for annuity terms of up to 25 years.
 
2

Current Amounts Needed to Purchase an Annuity: Go to the RRIFs web site and obtain high, low, and "in-between" interest rate quotes from three financial institutions for a 20-year RRIF annuity. Assuming the interest rates are compounded monthly, calculate the amount required in each case to purchase a 20-year annuity paying $3000 at the end of each month.
 




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