Present value of future annual earnings

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Just before his first attempt at bungee jumping, John decides to buy a life insurance policy. His annual income at age 30 is $36,000, so he figures he should get enough insurance to provide his wife and new baby with that amount each year for the next 35 years. If the long-term interest rate is 6.6%, what is the present value of John's future annual earnings? (Round your answer to the nearest cent.)

Rounding up to the next $50,000, how much life insurance should he buy? (Round your original answer to the nearest $50,000.)

Reference no: EM13974504

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