Assume you are married and have two children. You want to buy sufficient life insurance to take care of your family if you die. Your wife is a home-maker but has college loan of $40,000. Your children are teenagers. So you only need to provide the family with income for the next 10 years. Your household expenses run approximately $30,000. Assuming your wife can invest the insurance proceeds at 8 percent,
1. Calculate the amount of insurance you need to purchase.
2. Apply the same method and recommend insurance amount to a member of your family. Use appropriate values based on their needs.