Assume that jane now age 41 deposited 12000 in annuity


  1.  (Questions 1-2 are related.) Assume John Marshall owns a $160,000 home, which covers the replacement cost of the structure. (Ignore the deductible clause and consider just the coinsurance requirement.) If John purchased $128,000 of insurance, how much would he collect for a partial loss of $50,000? For a total loss of $160,000?
  2. If John purchased $90,000 of insurance, how much would he collect for a $40,000 loss? How much would he collect for a total loss? (Again, ignore the deductible clause.)
  3. Assume that Kate paid $90,000 for a $600-a month pure annuity. She dies after receiving the payments for five years. How much did she receive in annuity payments? How much will a
  4. Assume that Kate paid $90,000 for a $400-a month installment-refund annuity. She dies after receiving the payments for three years. How much will a successor beneficiary receive in cash payment at her death? For how many more years will a successor beneficiary be receiving the monthly payments?
  5. Assume that Jane, now age 41, deposited $12,000 in annuity premiums and the investment income increase the value of her account by $1,000, so its total current value is $13,000. Now assume that she withdraws $4,000 this year. Please explain the tax consequence of her withdrawal in the current year.

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Finance Basics: Assume that jane now age 41 deposited 12000 in annuity
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