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What is the new present value of the contract

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Reference no: EM131001993

A life annuity contract on (80) has a present value of 3.14. The annuity benefits at both age 80 and 81 are 1. The interest rate in the first year is 25% and p80 = 0.8. Suppose that the value of p81 increases by 10% while all other mortality rates remain unchanged. What is the new present value of the contract?

Reference no: EM131001993

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